IMF cuts China's growth forecast

29 May 2013

The International Monetary Fund (IMF) has cut its growth forecast for China in 2013 to 7.75 per cent from eight per cent after the weak global demand and reduced exports took its toll on the world's second-largest economy.

Low factory activity in April and May has led to private economists reducing the growth levels for 2013 and now the IMF has followed suit.

Bank of America-Merrill Lynch lowered its forecast this month to 7.6 per cent from eight per cent, while Standard Chartered cut its estimate to 7.7 per cent from 8.3 per cent.

The IMF's revised forecast is above the government's target of 7.5 per cent, but is in line with recent revisions.

In the past, stifling growth in China has been met by government stimulus, although the consensus this time is there will be no boost from policymakers as the nation becomes more tolerant of a slow economic growth speed.

By Claire Archer

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