China’s economic growth next year to be supported by fiscal policy, ‘limited’ need for ‘aggressive’ monetary easing
- Huang Yiping, a former member of the People’s Bank of China’s (PBOC) monetary policy committee, sees average growth this year at around 8 per cent
- China’s economy is slowing under headwinds from an energy shortage to a slump in the property sector
China’s fiscal policy will provide the main support to economic growth next year while significant monetary easing is unlikely, according to a former adviser to China’s central bank.
“The economy overall really is still OK and we will see average growth this year at around 8 per cent,” Huang Yiping, a former member of the People’s Bank of China’s (PBOC) monetary policy committee, said in an interview with Bloomberg TV.
“So the need for aggressive easing is quite limited.”
The PBOC will have to act if growth continues to slow, but the US Federal Reserve’s plan to normalise policy will narrow the room for action, said Huang, currently a professor at Peking University’s National School of Development.
The main job for supporting growth, I think, will be with the fiscal policy next year
“Monetary policy will probably remain flexible, and actions probably will be structural,” he said, adding that this could mean targeted easing and lending to small businesses.
“The main job for supporting growth, I think, will be with the fiscal policy next year.”