Transition to support “growth” from curbing “inflation”

Bloomberg published an article today, you can read introduction below:

Aug. 8 (Bloomberg) — China’s trade surplus probably fell for a fourth straight month, increasing the likelihood of more government measures to sustain the economy’s expansion rather than stamp out inflation.

The gap narrowed 17 percent to $20.25 billion in July from a year earlier, according to the median estimate of 16 economists surveyed by Bloomberg News.

China has loosened bank lending quotas, raised tax rebates for some exports and halted gains by the yuan to help manufacturers and small businesses as the world’s fastest- growing major economy shifts down a gear. President Hu Jintao, hosting the Olympic Games from tonight, said Aug. 1 that the country needs to maintain “steady and fast” growth.

“The government has little choice but to loosen policies to protect company profits and employment,” said Liao Qun, chief economist at Citic Ka Wah Bank in Hong Kong. “China will probably keep slowing the pace of currency appreciation in the second half and announce more measures to help businesses.”

Inflation may have cooled to the slowest pace in seven months in July, allowing policy makers to put a bigger emphasis on stimulating the economy.

….  (you can read the rest of Article from Bloomberg News.)

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