According to World Bank Group President Jim Yong Kim last Sunday, China would be able to reach its GDP growth target of 7.5% for the year. He did warn though of rising interest rates in emerging markets, resulting from the scaling back of the quantitative easing programme, indicate the presence of significant risk in future transactions.
In an interview with reporters, "The rise in interest rates as a result of the announcement of the tapering of QE has exposed weaknesses in the economies of emerging markets. Our message is very strong to those emerging markets: think about those weaknesses and begin to move."
A number of investment banks have upgraded their short term forecasts for the growth of China after a strong August performance. When the numbers include factory output and exports, a full year of growth had been achieved, well above the official target of 7.5%. The banks that have upgraded their growth forecasts for the year include CICC, Deutsche Bank, Nomura Holdings and UBS. These banks have pegged their rates at 7.6% or higher.
Join the Conversation