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Thursday, July 19, 2012

Worst Over for China's Economy, Another Rate Cut Seen

China's FIRST McDonald's
China's FIRST McDonald's (Photo credit: flickr.Marcus)
China's economy is likely to recover modestly in the third quarter of 2012 in response to policy stimulus, snapping six consecutive quarters of slower growth, but the full-year rate of expansion will be weaker than in 2011, a Reuters poll shows.
With Beijing intensifying policy fine-tuning to boost growth, analysts reckon the world's second-largest economy probably bottomed out in the second quarter, when growth cooled to 7.6 percent from a year earlier, the slowest pace in more than three years.
The median forecast by economists polled by Reuters showed annual economic growth could pick up to 7.9 percent in the third quarter of 2012 and 8.2 percent in the fourth quarter.
"Economic growth could rebound modestly from the third quarter as policy steps take effect," said Zhao Qingming, an economist at China Construction Bank in Beijing.
But the full-year growth rate is expected to dip to 8.0 percent this year from 9.2 percent in 2011, before picking up to 8.4 percent in 2013, given the growing headwinds from global economic uncertainties and softening demand at home. ... Continue to read.
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