1887

2005 OECD Economic Outlook, Volume 2005 Issue 2

image of OECD Economic Outlook, Volume 2005 Issue 2
Twice a year, the OECD Economic Outlook analyses the major trends and examines the economic policies required to foster high and sustainable growth in member countries. Developments in major non-OECD economies are also evaluated. The present issue covers the outlook to end-2007. Together with a wide range of cross-country statistics, the Outlook provides a unique tool to keep abreast of world economic developments.  In addition to the themes featured regularly, this issue contains an analytical chapter addressing the recent run-up in house prices.

English German, French

.

China

Economic growth in China has remained rapid in 2005 buoyed by a strong contribution from the external sector. During the projection period, output growth may stay above 9% and seems likely to be driven by domestic demand, as fiscal and monetary policies have been eased, moving to a more neutral stance, while the effective exchange rate has appreciated slightly. Nonetheless, the current account surplus, after increasing markedly in 2005, is unlikely to fall relative to GDP and may continue to increase in nominal terms. Inflation is projected to decline to under 4%, when measured by the GDP deflator.

Increasing stress is likely to emerge in the interaction between the authorities' exchange rate and monetary policies, given the continued size of the current account surplus and capital inflows. A further appreciation of the exchange rate would help to resolve these problems and guard against resurgence in inflation. It would also help move economic policy towards the use of market instruments, reducing the need for administrative control of credit and thereby reinforcing the progress that has been made in reforming the banking sector in the past year.

English French, German

This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error