UBS has reduced forecast growth in China

UBS believes that the Central Bank of China may ease monetary policy if the second-largest economy in the world will begin to weaken. The Bank expects China's GDP growth at 9% in 2011, UBS earlier forecast that the economy will add to the current year, 9.3%. In 2012, UBS expects Chinese GDP growth at 8.3% compared with the previous forecast of 9%, the bank said in a report. "This revision reflects a downward weaker growth prospects in developed economies", – said Wang Tao, an economist at the Chinese department of the bank. "A significant decline in export volumes, which may begin in the IV quarter of 2011 will probably also have a negative impact on investment in industrial production and consumption", – he added. UBS also cut the growth forecast for China's exports in 2011 to 15.1% from 18% and halve the export expectations for 2012 – up 5.5% to 12%. The bank lowered the forecast of inflation in China in 2011 to 5.2% from 5.3% to 3.5% from 4% in 2012, Citigroup also lowered the growth forecast on Thursday China's economy up to 9%, citing the weakness of the biggest export markets.