Chinese Premier Says 7% Target Not Carved in Stone

China has never said the economy must grow seven percent this year, Premier Li Keqiang said in comments reported by the government ahead of a key meeting this week that will set economic and social targets for the next five years.

Li’s comments coincide with remarks by a top central bank official, who said on Saturday that China would be able to keep annual economic growth at around 6-7 percent over that period.

The statements come at a time of growing concern in global financial markets over China’s once mighty economic juggernaut.

China cut interest rates for the sixth time in less than a year on Friday. Monetary policy easing in the world’s second-largest economy is at its most aggressive since the 2008/09 financial crisis, as growth looks set to slip to a 25-year-low this year of under 7 percent.

China’s economy grew 6.9 percent in the July-to-September quarter from a year earlier, data showed last week.

Speaking on Friday at the Central Party School, which trains rising officials, Li said the economic difficulties ahead for China should not be underestimated.

His report to the annual meeting of parliament set this year’s GDP growth target at about seven percent.

via Reuters

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza