China’s economic growth to further decelerate to 6.6 pct in 2017 and to 6 pct in 2018 - Westpac

China’s economic growth is expected to decelerate further this year and in next year. According to a Westpac research report, the Chinese economy is likely to expand 6.6 percent in 2017 and slowdown to 6 percent in 2018. The economic growth drivers in the country continue to shift. The government is strategically pulling back from the infrastructure spending that has supported growth in recent years. Moreover, the rising risks linked with high corporate leverage have urged President Xi to declare a crackdown on the financial risks from credit-driven growth that would be a drag on the private sector investment, noted Westpac.

As investment has decelerated, consumption has been rising at a moderate rate, mainly driven by rebounding credit availability and housing market developments. The trend in China is that consumption is quickly becoming an important part of economic growth, underpinned by rising middleclass, jobs in urban areas and the relative rise in disposable incomes. The shifting mix of China’s growth generally augurs well for exporters of consumer products such as New Zealand, and less so for exporters of industrial commodities such as Australia, added Westpac.