ChinaDaily:, the weakest expansion in ageneration as the country's leaders tackle debt risks and imbalances, according to analysts polled by Bloomberg. Thirteen of 22 economists said China will settle for about 7 percent growth next year, down fromthis year's 7.5 percent. Sixteen said the government should change its targeting policy, with nineindicating a range would be better Seven suggested targets be scrapped altogether in favor ofprojections or assumptions of growth, as most other nations provide.
The Chinese government is holding off on any broad stimulus, with Premier Li Keqiangexpressing a preference for policy improvements and People's Bank of China Governor Zhou Xiaochuan vowing to stick with a prudent monetary stance.
USDCNY seen between 6.1245 - 60 in early trading, with more CNY long liquidation likely ahead of the GDP release tomorrow. Meanwhile, 1Y NDFs seen supported above the 6.2500 handle between 6.2515 - 51. Expect prices to stay above the 6.2500 handle, with short covering likely to continue throughout the day. Market participants will be increasing worried that the GDP release will be coupled with an accompanying statement by the authorities warning of lower growth, and even a downward revision of the year's growth. The consensus for Q3 GDP lies at 7.20%, with risk tilted to the downside. However, we do not expect any disappointment to extend below 7.00% (search CNY+GDP+PREVIEW).
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