China's central bank said Nov. 9 it sees a continuation of gross domestic product (GDP) growth and expects it to surpass 9%.
The third quarter monetary report from the People's Bank of China reiterated that it would maintain prudent monetary policy in the fourth quarter as consumption, investment and net exports were expected to push forward economic growth.
China's GDP grew 9.4% in the first nine months of 2005, while its main inflation index, the consumer price index (CPI), rose 2%. It warned that it expected a rebound in fixed asset investment, which grew 26.1% in the first three quarters of the year, but downplayed the risk of deflation that some analysts have warned about as prices slipped over the year.
The report, published one day after Washington and Beijing struck a deal to restrict Chinese textile exports, added that risks included trade protectionism and high oil prices. "The hike in international oil prices has had a negative impact on China's economy and so it is necessary to speed up the reform of the oil pricing mechanism," it said. While global economic growth would continue to support the growth of Chinese trade, "a rebound in trade protectionism in some countries will cause some uncertainties in our exports," it said
The central bank also reiterated that it would maintain a stable yuan at reasonable and balanced levels while allowing market forces to help determine the unit's value.
Copyright Agence France-Presse, 2005