Upcoming results will show China's economy continued to weaken in August due to the government's caution in one-off stimulus plans and the sluggish recovery of the country's trading partners, a new report by the United Bank of Switzerland Limited (UBS) has predicted.
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The Consumer Prices Index (CPI), a main gauge of inflation, will show a rebound in August of 2 percent, up 0.2 percentage points from the previous month, driven by growth in food prices, the UBS said in its weekly report, released on Thursday.
CPI eased to 1.8 percent in July, the lowest reading over the past 30 months, in the wake of the government's price control measures. However,food prices, which account for one third of China's CPI calculation, are likely to rebound over the next few months as the weather's turning cold will affect vegetable harvests.
The Consumer Prices Index, a main gauge of inflation, will show a rebound in August of 2 percent, up 0.2 percentage points from the previous month, driven by growth in food prices, the UBS said in its weekly report, released on Aug. 30, 2012. |
The UBS expects China's economy will recover slowly in the second half, as entrepreneurs' confidence will not build if the government holds its silence about strong policy support.
But the bank maintains that the government's growth target of 7.5 percent this year is achievable despite the slowing recovery.
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