Flat growth rate in the world's second largest economy in 2013 and higher inflationary pressure is the predicted outlook, a senior Chinese official said Friday.
Next year, the economy will grow at a similar rate recorded in 2011, which is projected to be slightly higher than the 7.5-percent government target, Yu Bin, director of the Macroeconomic Research Department at the Development Research Center under the State Council, or China's Cabinet, said at a press conference.
Yu estimated that China's growth may have bottomed out in the third quarter of 2012 and a slight rebound may be seen in the final three months of the year. This is due to earlier data for exports, industrial production and retail sales showing signs of improvements.
"The economy is currently in a stage of shifting to moderate growth rates somewhere between 7 percent and 8 percent from an annualized growth rate of 10.6 percent over the past ten years," the economist said.
Growth of exports and consumption, the economy's key drivers, will remain stable next year, but the investment, another growth driver, is likely to head downwards due to gloomy property, manufacturing and infrastructure construction sectors, Yu said
Meanwhile, the growth of consumer price index (CPI), the main gauge of inflation, will rise to 4 percent in 2013, Yu said. The figure is much higher than the below-3 percent rate predicted for the year.
Easing measures adopted across economies, including the U.S., the European Union and Japan, have pushed up prices for global commodities and attracted inflows of short-term capital, which will likely hike CPI rates next year, he said.
Relatively-tight food supplies and monetary loosening at home, which was targeted to inject money into the market to buoy the slowing economy, may also turn the inflationary expectation into reality, he said.
Yu said he believed that the government will continue to implement a proactive fiscal policy and prudent monetary policy next year, in order to boost investment through bold fiscal spending while refraining from excessive monetary loosening to keep inflation in check.
The government's efforts to contain the runaway real estate market and flagging exports have lowered the economy's growth to a seventh-quarter low of 7.4 percent in the third quarter of the year.
Chinese authorities have moved more cautiously to address the downturn than they did during the 2008 financial crisis. The central bank has twice cut banks' reserve requirement ratio and interest rates this year, falling short of market expectations.