Modest China slowdown as exports, housing drag: Reuters poll

Thu Jan 19, 2012 3:51am EST
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BEIJING (Reuters) - China's 2012 economic outlook has dimmed because of weakening export demand and a faltering housing market, and its central bank will probably try to spur more bank lending to prevent a steeper slump, a Reuters poll showed on Thursday.

Economists on average predicted gross domestic product growth would slow to 8.4 percent from 2011's 9.2 percent.

That is weaker than the 8.6 percent consensus in a similar poll conducted in October and 8.8 percent in the previous poll in July.

Of the 34 economists surveyed, only five predicted that GDP growth would dip below the 8 percent mark seen as the minimum for ensuring sufficient job creation. But in the survey three months ago, not one of the economists thought GDP would breach the 8 percent threshold.

China's growth rate slowed to 8.9 percent in the fourth quarter, the slowest pace in 2- years.

Economists widely expect the economy to deteriorate further, although the Reuters poll showed that they expect the first quarter to be the trough, with growth picking up as the year progressed.

"We expect things to get worse before they get better," Qu Hongbin, China economist with HSBC, wrote in a note to clients.

First-quarter growth may ease to 8.2 percent with one economist predicting a growth rate as low as 7.2 percent, according to the Reuters poll.

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