CICC Lifts China '18 GDP Outlook on Consumption and Investment

--Estimates 2018 GDP 6.9% Vs. Previous 6.7%; Market Consensus 6.4%

--Nominal GDP to Exceed 10% in 2018 and 2019

--Housing Construction to Jump 15% in 2018

--2018 CPI 2.5%, PPI 3%; Consensus Forecast for 2017: CPI 1.6%, PPI 5.7% (Wind

data)

--Yuan to Strengthen to 6.48 end-2018 from CICC Estimate of 6.68 end-2017 

--Money Supply to Tighten; Fiscal Spending "Loose"

     BEIJING (MNI) - China's economy is likely to grow stronger than market

expectations next year on strengthened outlooks for consumption and investment

in manufacturing and property, China International Capital Corp. said Monday. 

     Gross domestic product may expand by 6.9% in 2018, up from a prior estimate

of 6.7% and much higher than the 6.4% market consensus, the state-owned

investment bank said in a report. 

     Nominal GDP for both 2018 and 2019 is likely to be above 10%, reflecting an

"unusual economic impetus" that may lead to strengthened business revenues and

returns, CICC wrote. Given businesses so far have been cautious in expanding

their borrowing, investing now should generate higher returns, CICC said.

     Housing construction in 2018 may jump as much as 15% compared with this

year, given strong land acquisition by developers in the first three quarters as

well as polices that support the government drive for more rental and low-income

housing, CICC said. Developers snapped up 12.2% more land this year compared

with a year ago, it said.

     Other key notes from the report:                   

     --Manufacturing to expand after a contraction phase in 2016-2017

     --Sustained growth in new industries: environmental protection,

higher-value-added manufacturing and consumption

     --Stable pace of infrastructure investment

     --Exports to grow given the stable outlook in external demand

--MNI Beijing Bureau; +86 10 8532 5998; email: william.bi@mni-news.com

--MNI Beijing Bureau; +86 (10) 8532-5998; email: vince.morkri@marketnews.com

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