The growth in China's gross domestic product may slow to 10.1 percent this year and to 9 percent in 2009, said Fan Caiyue, a researcher at the National Development and Reform Commission, China's top economic planning agency.
Consumer prices in the country may also ease to between 3 percent and 4 percent next year after reaching 6.3 percent this year.
Fan predicted China's GDP could sustain an expansion of 9.8 percent between January and September from 10.4 percent in the first half.
"China's economy is under pressure from the impact of a global downturn. But its fundamentals are solid and are able to support long-term growth," said Fan in a report published yesterday. "The government has fine-tuned macroeconomic policies but if they don't work properly, China can't rule out the possibility of posting a growth below 9 percent in 2009."
Fan sees inflationary pressure to ease next year as food prices will stabilize due to the summer harvest and domestic producer prices will fall in on lower commodity costs.
However, domestic consumption, which has been the biggest economic driver since last year, will begin to slow in 2009 after surging this year while the gloomy global economic outlook may weaken home demand.
Fan forecast China's retail sales may jump 20.7 percent this year and slow to 17.5 percent in 2009.
The trade surplus will likely to be cut to US$252 billion this year and US$256.7 billion in 2009 from last year's US$262.2 billion, because of the stronger Chinese currency and slower export growth.
"China has to carry out a prudent macroeconomic policy which is also flexible to counter any swift changes in the economy," said Fan. The major challenge will be how to stimulate home consumption and to keep growing it steadily.
The National Bureau of Statistics is set to release the key economic data for the third quarter next week.
