BOC Hong Kong predicts China's mainland's economic growth at 6.8 pct in 2016

Bank of China (BOC) (Hong Kong) Limited Tuesday forecasted that Chinese mainland's economic growth in 2016 will be at 6.8 percent, even though global environment is not favorable to export.

Deputy General Manager of Economic & Strategic Planning Department, BOC Hong Kong E Zhihuan said at a press conference that although China's mainland's export growth is likely to be hindered by global environment, domestic market demand, growth in infrastructure and consumption expenditure are still high. It is expected the gliding trend of the economy to slow down and the growth rate will be 6.8 percent next year.

The bank estimated that the RMB exchange rate towards U.S. dollars will drop to 6.6 yuan to 1 U.S. dollar. RMB is put under pressure due to the narrow interest rate differential between China's mainland and the U.S., but as the U.S. interest rate hike was a mild one, the appreciation of U.S. dollar has been weakened. RMB would, as a whole, become stabilized after the down.

As for Hong Kong, the bank was pessimistic about the region's external trade and tourism industry next year. With such a weak overseas market demand, domestic market demand would become the main drive in economic growth.

The economic growth and unemployment rate of Hong Kong in 2016 are expected to remain the same as this year, 2.5 percent and 3.3 percent respectively; the inflation rate to see a year-on-year rise of 2.2 percent. Endit