WASHINGTON (Sputnik) – China will retain a strong overall growth rate this year, but will slightly slow to 6.6 percent of Gross Domestic Product (GDP), compared with 6.9 percent in 2017, the International Monetary Fund (IMF) said in a press release.
“Growth is projected to weaken slightly to 6.6 percent in 2018 owing to the lagged effect of financial regulatory tightening and the softening of external demand,” the release said on Thursday. “The Chinese economy continues to perform strongly. GDP growth accelerated to 6.9 percent in 2017.”
The IMF explained that China’s headline inflation has remained contained at around 2 percent and is expected to rise gradually to 2.5 percent.
“Reforms progressed in several key areas. A wide range of regulatory reforms reduced financial sector risks, overcapacity reduction progressed, anti-pollution efforts intensified and opening-up accelerated recently,” the release said.
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The IMF noted that credit growth slowed significantly, but remained strong. While the corporate debt to GDP ratio stabilized, total nonfinancial sector debt still rose faster than nominal GDP growth and the deficit of the government sector was estimated to be around 11 percent of GDP in 2017, the IMF said.