|Girish Shetti |||Jun 10, 2016 08:06 AM EDT|
(Photo : Getty Images) China's central bank is resolute that the country's economy will grow at 6.8 percent in 2016.
The People's Bank of China is sticking to its earlier predicted growth rate of 6.8 percent despite a host of challenges confronting the Chinese economy. The central bank's growth rate is higher than the 6.5 percent projected by International Monetary Fund (IMF) and the Asian Development Bank (ADB).
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"Since the beginning of this year, the global and domestic economic environment has experienced a number of changes. Reflecting these recent developments, we revised our China macroeconomic forecasts for 2016. Compared with our published forecasts in December last year, we maintain our baseline projection of 2016 real GDP growth at 6.8 percent," a statement from China's central bank said.
The PBOC noted that investment in China's real estate and infrastructure has improved, but overall private investment remains weak. In other important projections, the central bank downgraded export from 3.1 per cent to negative 1 per cent, citing sluggish demand in the global market.
Earlier this week, China released its latest trade figures showing that exports in May had declined by 4.1 percent, marking the 10th decline in the last twelve months. However, a moderate fall of 0.4 per cent in imports in May brought cheers to economic experts.
The central bank's growth forecast comes on the back of improved inflation data. The latest inflation figures released on Thursday shows that inflation in May rose by 2.0 percent compared to 2.3 percent recorded in April. This is the first time that Inflation in China has cooled in seven months.
China is currently witnessing its worst economic crisis in last two decades, with most key economic indicators showing no sign of improvement. The Chinese government has expressed assurance that despite all the challenges, the country's economy would not experience a 'hard landing.'
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