Central bank advisor forecasts slower growth

Chinese central bank advisor Song Guoqing forecasted a slower growth rate of 7.4% this quarter, warning that the world’s second-largest economy has yet to bottom out, Bloomberg reported. “The consensus is that China’s economic growth rate will be close to 8% in coming months, but I personally am more pessimistic because there are problems on the export side,” Song said at a forum in Beijing. He also cautioned that a fall in producer prices combined with a spike in consumer inflation may dampen investment. China’s growth slowed to 7.6% in the second quarter, the sixth straight period of deceleration. Lu Ting, an economist at Bank of America in Hong Kong, warned that China’s downward spiral could worsen in the second half if Beijing does not act decisively to stimulate the economy.