Standard & Poor confident on China’s growth

While most remains concerned over weakness in China and many analysts calling for further weakness in the economy, rating agency Standard & Poor is broadly confident over China's growth engine. The rating agency expects China to keep performing strongly over next two/three years.

S&P also maintained, China's sovereign credit rating AA, saying it is confident that China will keep growing around 6% per annum, while the government continues structural reforms.

China's current GDP growth is around 7%, so going by S&P's estimate, economy might slow a bit further. However it would be of lesser concern if it is able to maintain growth above 6% and shift its economy from investment dependent to consumption oriented. S&P feels investment to GDP ratio to drop below 40%. The rating agency expects per capital GDP to grow at 5.5% per annum.

Though concern level around Chinese economy eased after August turmoil, continued drop in commodities market might be indicating further weakness in demand, be it structural reasons or slowdown.