From Bloomberg:
Premier Li Keqiang’s government sees 7 percent growth as the bottom line for tolerance of an economic slowdown, Chinese news organizations reported, signaling the nation will act to support expansion if needed.
Expansion below 7 percent won’t be accepted because China needs to achieve a moderately prosperous society by 2020, according to a commentary published July 21 by the official Xinhua News Agency and credited to reporter Wang Yuewei. Li said at a recent meeting with economists that 7 percent is the “bottom line” and the nation can’t allow growth below that, the Beijing News reported today.
China is growing slightly below that rate now so some form of stimulus will be needed to offset the slowing that’s coming from the property curbs and credit crunch. But it’s still unclear if it will be needed. Li also said:
As long as the economic growth rate, employment and other indicators don’t slip below our lower limit and inflation doesn’t exceed our upper limit we’ll focus on restructuring and pushing reforms.
