Growth in China is expected to remain strong in 2011 although slowing slightly from the rate of expansion seen last year as inflation remains above the government’s target level, according to Reuters. The latest poll of 19 analysts found that the Chinese economy is expected to grow by 9.5% in 2011, slowing from the breakneck 10.3% rate of expansion posted during 2010. Growth in the second quarter is expected to be 9.4%, which would be a slight slowdown from the 9.7% growth in the first three months of the year.
JPMorgan said, “We expect the Chinese economy to continue with trend-growth in the coming quarters,” noting that employment and wage growth “should be supportive of steady overall consumer demand growth later this year.” The rapid expansion is expected to keep inflationary pressure high, with price growth for the full year expected at around 4.5%, which would be more than the 3.3% inflation recorded during 2010. Price growth is forecast to slow to 3.9% in 2012, which comes along with expectations for further fiscal tightening from the central bank.
