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From the markets: China expects slower economic growth and less inflation

March 5, 2012
Chinas Premier Wen Jiabao announced a lower economic growth target of 7.5% (from previously 8%) at the annual meeting of the National Peoples Congress in Beijing. China will also aim for lower inflation this year.

China expects economic growth to slow to a 7.5% annual pace from an 8% goal in place since 2005, according to Wen Jiabao, who was speaking at the annual meeting of the National People s Congress. In 2011, China s gross domestic product weakened already to 9.2% from 10.4% a year before. Beijing will also aim for inflation of about 4% this year, unchanged from last year s target. Wen reiterated that the government will maintain a proactive fiscal policy and a prudent monetary policy. China’s servicing sector slowed in February according to the China Federation of Logistics & Purchasing. The Non Manufacturing Index slipped to 48.4 from 52.9 points in January. To the contrary, HSBC s activity index for the Chinese service area at the same time improved to 53.9 in February from 52.5. The Hang Seng Index lost 1.35% and the Shenzhen CSI 300 Index declined 0.7%.