Chinese central bank adviser Xia Bin said that the nation’s growth is “sound” and he doesn’t believe that the government needs to implement any “major” stimulus measures.
He spoke in an interview in Beijing today after the government announced yesterday that growth slowed to 9.1 percent in the third quarter, the slowest pace in two years. The central bank should stick to its “prudent” monetary policy, he said.
UBS AG said late yesterday that the government may come up with a “small stimulus” of about 2 percent of gross domestic product at the start of next year by easing fiscal and credit policies. Based on the size of the economy last year, the amount would be about 800 billion yuan ($125 billion).
“I don’t believe China will launch another round of major economic stimulus,” said Xia, an academic member of the central bank’s monetary policy committee. He said that growth “remains sound.”
Foreign direct investment into China grew at a slower pace in September, climbing 7.9 percent from a year earlier, the smallest gain in three months, the commerce ministry said today. The amount was $9 billion.
China’s economy has cooled after increases in banks’ reserve requirements and interest rates and as Europe’s sovereign-debt crisis and elevated unemployment in developed economies caps export demand.
— With assistance by Paul Panckhurst