China's economy to grow by 6.93% in Q2

BEIJING - China's economy will grow by 6.93 percent year on year in the second quarter, said a report by the National Academy of Economic Strategy (NAES), which is affiliated to the Chinese Academy of Social Sciences on Friday.

Released at a meeting co-hosted by NAES and the Economic Information Daily, the report made the quarterly-based analysis on China's micro-economy.

The growth forecast is lower than the 7-percent annual growth target, but 0.13 percentage points higher than the earlier NAES forecast.

Economists took various factors into consideration, including a continuous fall in foreign trade, steady consumption and an investment increase, said NAES deputy director Wang Hongju, who is also one of the chief economists that drafted the report.

NAES head Gao Peiyong expects more cuts to bank interest rates and reserve requirement ratio (RRR) in the second half of the year, and advised the country to boost infrastructure investment to shore up growth.

"The annual growth target is attainable as China is introducing more pro-growth measures," according to the report.

China has taken measures to arrest the slowdown. The central bank has cut the benchmark interest rate three times since November. It has also dropped banks' RRR twice since February. In March, China reduced payment levels for second-home buyers to 40 percent from the previous 60 to 70 percent, and exempted business tax for sales of homes purchased over two years ago.

The consumer price index is likely to grow by 1.3 percent year on year in the first half year, said the report, well within the annual target of 3 percent.