China quarterly update, April 2011

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China quarterly update, April 2011

Abstract

China's economic growth has remained resilient as the macro stance moved towards normalization. Both fiscal and monetary policy contributed to the normalization. Consumption growth slowed in early 2011. But overall domestic demand held up well, supported by still strong investment growth. Real estate investment has so far remained robust to measures to contain housing prices, a policy focus. Reducing inflation is the other policy priority, after inflation rose to 5.4 percent, largely on higher food prices. The global growth outlook has so far been little affected by the higher raw commodity prices and the earthquake in Japan. Domestically, headwind from a normalized macroeconomic stance, inflation, and somewhat slower global growth is likely to be partly offset by solid corporate investment and a still robust labor market. An expected slowdown in mainstream housing construction should in part be compensated by the government's ambitious social housing construction plans. With a broadly neutral contribution of net trade, project China's real Gross Domestic Product (GDP) growth at 9.3 percent in 2011 and 8.7 percent in 2012. The surge in raw commodity prices means we expect another decline in the current account surplus this year. However, whether the trend towards a lower external surplus and lower dependence on external trade will be sustained remains to be seen. Show Less

Details

Document Date	2011/04/01
Document Type	Newsletter
Report Number	61400
Volume No	1 of 1
Country	China
Disclosure Date	2011/04/29
Doc Name	China quarterly update, April 2011
Keywords	Agricultural prices, agriculture, annual growth, asset markets, balance sheets, bank balance sheets, bank credit, bank expo... Show More Agricultural prices, agriculture, annual growth, asset markets, balance sheets, bank balance sheets, bank credit, bank exposure, bank lending, Bank Office, banking system, benchmark, beneficiaries, bond, bond issuance, Broad money, budget deficit, buffer, capital controls, capital flows, capital formation, capital market, capital requirements, commodities, commodity, commodity price, commodity prices, common currency, competitiveness, Consensus Forecasts, consumer confidence, consumer goods, Consumer price, Consumer price inflation, consumer prices, consumers, Consumption growth, core inflation, corporate investment, corporate paper, credit growth, currency, current account, current account balance, current account surplus, demand growth, deposits, Developing countries, developing economies, disposable income, disposable incomes, distortions, domestic consumption, domestic demand, domestic demand growth, domestic economy, domestic prices, downward pressure, ECONOMIC DEVELOPMENTS, Economic Geography, economic growth, economic outlook, ECONOMIC POLICIES, effective exchange rate, emerging markets, energy prices, exchange rate, exchange rate appreciation, EXCHANGE RATE POLICY, exchange rates, expenditure, Expenditures, export growth, export ratio, export volumes, Exports, external balance, external terms of trade, external trade, fair, finances, financial flows, financial institutions, financial policy, financial risks, financial system, financing of investment, Fiscal policy, fixed asset, food price, food prices, forecasts, foreign assets, foreign exchange, Foreign exchange reserves, foreign investors, Foreign reserves, GDP deflator, global demand, global economy, global market, global markets, government deficits, Government expenditure, government policy, government spending, gross capital formation, growth rates, Household income, housing market, human capital, imbalances, import, imports, income, income growth, income inequality, income tax, inflation, inflation expectations, infrastructure investment, insurance, insurance industry, insurance market, Insurance Policy, interest rate, interest rates, international developments, international prices, investment patterns, Knowledge Economy, labor force, labor market, liquidity, local government, local governments, M2, Macroeconomic policy, market access, market economies, market economy, market exchange rates, Market Integration, market prices, market share, medium term notes, Monetary conditions, Monetary Fund, monetary policy, money growth, monopolies, moral suasion, Net exports, nominal exchange rate, oil commodities, oil price, oil prices, output, pension, pensions, personal income, physical assets, policy response, price changes, price control, price hikes, price increase, price increases, price levels, price volatility, Producer price, Producer price index, production costs, productivity growth, property market, provident funds, public debts, public expenditure, PUBLIC FINANCE, purchasing, purchasing power, quotas, Rapid Development, rapid expansion, rapid growth, real appreciation, Real effective exchange rate, Real estate, Real estate investment, Real exchange rate, real GDP, real income, relative price, relative prices, reserve, reserve requirement, reserves, retail, Retail prices, sales, services market, side effects, slowdown, social developments, spare capacity, spread, stocks, structural reforms, supply chains, supply shocks, supply side, surplus, tax, tax exemption, tax reform, tax revenues, track record, trade balance, trade data, trade growth, trade surplus, transaction, trust loans, unemployment, urbanization, valuation, value added, volatility, wage growth, wages, wealth, weights, withdrawal, world economy, World prices, world trade Show Less
Language	English;
Major Sector	Public Administration, Law, and Justice; Finance;
Rel. Proj ID	CN-Macro-Fiscal Policy Notes Fy11 -- P122988;
Region	East Asia and Pacific;
Rep Title	China quarterly update, April 2011
Sector	General public administration sector; General finance sector;
Topics	Private Sector Development; Macroeconomics and Economic Growth; Finance and Financial Sector Development;
SubTopics	Markets and Market Access; Economic Theory & Research; Emerging Markets; Currencies and Exchange Rates; Debt Markets;
Unit Owning	Office of the Regional Vice Pres (EAPVP); Library & Archives ofDevelopment (ISGLA)
Source Citation	China quarterly update. -- (April 2011)

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