MNI BRIEF: China GDP Growth Likely 4.8% In Q3 - BOC
MNI (BEIJNG ) - China is likely to see a 4.8% GDP expansion in Q3, and a possible 5.1% in Q4 should supportive measures strengthen domestic demand, Bank of China said in its quarterly report on the economic and financial outlook on Thursday.
BOC suggested fiscal authorities must intensify and accelerate efforts,increasing the budget deficit and issuing more government bonds, following the People's Bank of China's monetary policy easing measures this week. (See MNI: More RRR Cuts Would Pave Way For China Bond Sales-Advisors) China should also push for the full removal of all types of house buying rules, such as encouraging first-tier cities to lift restrictions on purchases and cancelling or reducing property-related transaction taxes and fees.
The yuan is expected to rise further towards 6.90 against the dollar in Q4 thanks to the Federal Reserve’s easing and the strengthening China economy, the BOC reported, noting the country's significant trade surplus will drive a stronger currency as exporters increasingly convert dollar into renminbi. However, the greenback will likely fluctuate due to the uncertainty of the Fed’s easing pace, which may also pressure the yuan, BOC noted.