Pressure on China to tighten monetary policy and macroeconomic controls is easing as inflation will be “relatively low” this month due to slowing food-price gains, central bank adviser Song Guoqing said.
Compared with January and February, the pressure “has in my view, been relieved,” Song said at a forum in Beijing yesterday. “That’s good news for growth.” He estimated first- quarter economic expansion will accelerate to 8.3 percent.
The People’s Bank of China drained cash from the financial system in each of the two weeks since the Lunar New Year holiday ended on Feb. 15, boosting speculation that it was tightening amid concerns inflation was accelerating and real-estate price gains were excessive. The State Council stepped up efforts to cool the property market on March 1, five days before the country’s legislature is due to start its annual meeting that will see Li Keqiang take over from Wen Jiabao as premier.
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