China’s Q3 GDP grows at slowest pace in two years
Xinhua – 18/20/2011
China’s GDP expanded 9.1 percent year-on-year in the third quarter of the year, marking the slowest pace since the third quarter of 2009.
The growth rate was down from 9.5 percent in the second quarter of this year and 9.7 percent in the first quarter, the National Bureau of Statistics (NBS) said Tuesday.
The slowdown was a desired outcome of China’s macro-economic regulations as the government continued its efforts in curbing soaring property prices, reining in inflation and regulating local government financing vehicles, said Lian Ping, the chief economist with Bank of Communications.
Lian expected the country’s GDP growth to remain above 9 percent this year.
China’s economy expanded 2.3 percent on a quarterly basis in the July-September period, NBS spokesman Sheng Laiyun said at a press conference.
According to preliminary statistics, the country’s GDP reached 32.07 trillion yuan (5.01 trillion U.S. dollars) in the first nine months, up 9.4 percent year-on-year, Sheng said.
He noted the country’s economic performance was “generally good” and had developed according to macro-economic regulations in the first nine months.
Despite challenges and uncertainties both at home and abroad, it is likely that China’s economy would maintain its stable and relatively fast growth in the coming period, boosted by a strong growth momentum, Sheng said.
He said there was an obvious trend of the country’s economic development shifting from a stimulus policy-driven growth to a self-initiated mode.
Industrial value-added output rose 13.8 percent year-on-year in September, up from the 13.5 percent growth in August. Fixed assets investment rose 24.9 percent year-on-year in the first nine months, compared with a 25-percent gain in the January-August period.
In September, the country’s retail sales expanded 17.7 percent from a year earlier, following an increase of 17 percent in August.
Sheng said the country’s consumer price increase had been “preliminarily contained” as the growth of the consumer price index (CPI), a main gauge of inflation, had fallen for two consecutive months.
It is quite likely that consumer price increase would continue to ease in the last quarter of the year, he said.
The government made curbing consumer prices a top priority in this year’s macro-economic regulations and vowed to keep the annual growth of CPI at around 4 percent this year.
To mop up the excessive liquidity that helps fuel inflation, the government implemented a prudent monetary policy this year. The central bank has raised the benchmark interest rates three times this year and hiked the reserve requirement ratio for commercial banks six times.
The central bank may not relax the prudent monetary policy in the short term with the inflation rate still at a high level, said Liu Ligang, director of the economic research department of ANZ Greater China.
He added that the central bank is likely to enhance financial support for capital-strapped small and medium-sized enterprises.
“The country’s economy is heading for a soft landing,” Liu said.
Although exports would continue to moderate on weaker demand from developed economies, growth would still be supported by domestic demand, investment and consumption, he said.
Liu estimated the country’s economic growth would stand at 9.4 or 9.5 percent this year.