Caterpillar Inc., the world’s largest maker of construction and mining machines, said China’s economic growth will probably recover this year as the government continues to stimulate growth.
China cutting interest rates would help boost growth and “our thesis is that that will continue and we will probably see China recover later this year or early next,” Stuart Levenick, group president for customer and dealer support of the Peoria, Illinois-based company, told reporters today in Newcastle, Australia.
China’s economy, the world’s second biggest, is growing at the slowest pace in three years after the government put in place measures to cap inflation and the euro-area debt crisis crimped global confidence. Caterpillar, with 25 percent of sales in Asia, has cut production at its main Chinese excavator factory, the company said Aug. 24.
“We have confidence in long-term commodity demand,” Levenick said, based on developing nations becoming wealthier and urbanization driving demand for resources.