Bloomberg quoted Ms Jing Ulrich managing director and chairman of global markets for China said JPMorgan Chase & Co will cut its 2012 China growth forecast if the economy weakens further.

She said that the trend is for the Chinese economy to moderate through the third quarter, whose current growth estimate for China is 7.7%.

She added that JPMorgan expects China to announce more fiscal policies such as tax cuts in coming weeks. The country is also very concerned about housing prices and will maintain tight policies.

Ms Ulrich said rising housing prices are actually concerning the central government. They don’t want prices to rebound too sharply. After all, the housing issue is a social issue and not just an economic issue.

She said heavy industries such as steel and cement are bearing the brunt in the current slowdown, recommending Chinese retail, service and e-commerce stocks, without naming any.

Source - Bloomberg

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