LINE

Text:AAAPrint
Economy

Credit Suisse raises China's GDP forecast

1
2016-04-08 10:11CCTV Editor: Feng Shuang

The Caixin service PMI headline index has improved in March.The Caixin China General Services Business Activity Index (headline service PMI) increased to 52.2 in March from February's 51.2. China's manufacturing activity also improved in March, as separate surveys showed last Friday, helping ease concerns over slow economic growth that depressed market sentiment.

The latest report by Credit Suisse revised China's GDP forecast for Q2 from 6.3% to 6.5%.

China's official manufacturing Purchasing Managers' Index (PMI) came in at 50.2 for March, returning to growth for the first time since July. That compares with 49.0 in February, which was the lowest reading since 2011.

China's official services PMI rose to 53.8 in March from 52.7 in February. Levels below 50 signal contraction, while levels above indicate growth.

One economist believes the Chinese economy is stabilizing.

"We believe that the Chinese economy has started reacceleration, it's not gonna be mile one, but we do believe things are improving," said Tao Dong, Chief Economist, Non-Japan Asia, Credit Suisse.

"Both Moody's and Standard & Poor's have cut the outlook for China's credit rating, the Chinese government response has ranged from 'we don't care,' to 'they are misjudging.' What do you think," CCTV reporter Zhu Dan asked.

Tao replied:" I think Chinese economy is a very much closed capital account and domestic savings is the backbone of the leverage, so I think international rating agency's downgrading China probably will have limited impact to the overall financial stability."

According to Credit Suisse, China still has a long way to go in cutting industrial capacity and reducing housing inventory. And advancing reforms is critical for China to move back to self-sustained growth path. Nevertheless, the short-term hard landing risks are on the decline.

As China's economy slows and investment return falls, it's conceivable that Chinese capital will invest overseas for return enhancement and portfolio diversification.

Charles Li, CEO of Hong Kong Exchange and Clearing Limited, believes the global market is ready for Chinese capital.

"The rest of the world are there for Chinese to play, and one thing I keep appealing to the Chinese regulators is that you're responsibility is not only for companies to raise capital, not only help domestic exchanges to grow, but also help Chinese citizens to manage their assets for the rest of their life, for their children, and they can't put their assets in one big basket, that is China, they have to diversify, they have to come out, and they will come out," he said.

Charles Li also said that a preparatory period of three to four months will be required by both the Chinese mainland and Hong Kong markets once regulators approve the Shenzhen-Hong Kong Stock Connect.

And that will further the progress of China's capital market opening.

  

Related news

MorePhoto

Most popular in 24h

MoreTop news

MoreVideo

News
Politics
Business
Society
Culture
Military
Sci-tech
Entertainment
Sports
Odd
Features
Biz
Economy
Travel
Travel News
Travel Types
Events
Food
Hotel
Bar & Club
Architecture
Gallery
Photo
CNS Photo
Video
Video
Learning Chinese
Learn About China
Social Chinese
Business Chinese
Buzz Words
Bilingual
Resources
ECNS Wire
Special Coverage
Infographics
Voices
LINE
Back to top Links | About Us | Jobs | Contact Us | Privacy Policy
Copyright ©1999-2018 Chinanews.com. All rights reserved.
Reproduction in whole or in part without permission is prohibited.