(Yicai) Sep. 9 -- Confidence in China’s economic outlook softened this month to the lowest since January last year, according to chief economists polled by Yicai.

The Yicai Chief Economist Confidence Index dipped to 49.96 in September from 50.3 in August, falling below the key 50 level for the first time in 20 months, according to the findings of a survey of 15 leading China-based economists published by Yicai yesterday.

China’s economic recovery is still under pressure because of domestic and international disruption, so more policies to stabilize the economy and restore effective demand are needed, the economists believe.

The consumer price index likely rose 0.65 percent last month from a year earlier, faster than July’s 0.5 percent increase, they predicted. They expect the producer price index to have fallen 1.39 percent, compared with the previous month’s 0.8 percent decline.

The CPI inched up 0.6 percent, and the PPI fell 1.8 percent in August from the same period last year, according to data released today by the National Bureau of Statistics.

While investment probably remained flat, consumption, production, and foreign trade were likely all lower last month than in July, according to the economists.

Their average forecast for fixed asset investment growth remained steady at 3.58 percent for August. Their prediction for growth in consumer goods sales and industrial added value came in at 2.61 percent and 4.77 percent for last month, compared with 2.7 percent and 5.1 percent, respectively, in July. China’s trade surplus likely fell to USD81.5 billion from USD84.7 billion.

Meanwhile, the economists expect financial data to have picked up in August from the prior month. New yuan-denominated loans and social financing likely increased to CNY1.02 trillion (USD143.2 billion) and CNY2.84 trillion, respectively.

However, their average forecast for growth in M2, a broad measure of money supply that covers cash in circulation and all deposits, fell to 6.26 percent from 6.3 percent in the period.

Nearly a third of the economists expect China’s central bank to lower the benchmark deposit interest rate and the one-year and five-year loan prime rates by the end of the month.

The Chinese yuan stood at 7.1124 against the US dollar on Aug. 30. The economists see the yuan at 7.08 by the end of September and increased their expectations for the end of the year to 6.99 from 7.03.

Editor: Futura Costaglione