China: fragile stabilisation of the economic growth

The latest available statistics and surveys for China show that the deceleration of the economic growth has stopped during the last weeks, but the momentum is now quite low. Indeed, industrial production has been stable recently (at a low growth rate), especially in the automotive sector. Then, the Chinese central bank (PBoC) will be very cautious with any further monetary easing: unemployment has gone further down, while recent inflation acceleration is due only to the price of pork meat. The PBoC could lower further the one-year loan prime rate of 5bp only. Further to this, the government will announce a further easing of the fiscal policy in order to support investment.