China watchers see soft landing for economy in 2015
HONG KONG (MarketWatch) — For years now, China has been haunted by the spectre of a possible “hard landing,” with fears including a financial collapse and bad-debt crisis, crippling deflation and sharp drop in economic growth that could lead to political instability.
But listen to some of the financial community’s top China-focused analysts, and the situation doesn’t sound so dire.
Yes, the government’s efforts to balance reform with growth may exert a downward pressure, but it will be a “soft landing,” a moderation rather than an outright contraction, with prices to remain stable, or so say the analysts.
Société Générale economist Wei Yao is one such voice predicting a manageable deceleration, describing it as the “new norm,” with “slower economic growth but of better quality.”
While she sees reforms as weakening the government’s long-standing backstop for the economy and markets, “thus adding downside risk,” she also sees Beijing as willing to “mitigate the pain” of such reform via stimulus.
http://www.marketwatch.com/story/china-watchers-see-soft-landing-for-economy-in-2015-2014-12-30