China’s economy will grow at about 6.6 per cent this year, and will need to be underpinned by policy support in the second half to counter downward pressures, according to the China Academy of Social Sciences (CASS).
The forecast from one of China’s top government think-tanks was reported by the official Shanghai Securities Journal newspaper on June 28, and marked a slightly more downbeat outlook that one given in May, when CASS had forecast growth of 6.6 per cent to 6.8 per cent for the year.
Consumer price inflation will likely rise 2 per cent for the year, while the decline in producer prices will slow, according to the CASS forecasts. Inflation was running at 2.1 per cent for the first five months of the year.
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Retail spending growth will be stable, but money supply growth will slow, as will growth in investment in fixed assets and property development.
CASS said China should deepen economic reform and restructuring in the second half of the year, optimize leverage levels, and clean up zombie firms.