(Yicai) Feb. 11 -- Confidence in China's economic prospects remained upbeat this month, as chief economists surveyed by Yicai expect the effects of government stimulus policies to become more apparent as they are gradually implemented.

The Yicai Chief Economists Confidence Index came in at 50.62 for February, down from 50.66 in January and 50.72 in December but remaining above the contraction-expansion threshold of 50 for the fifth straight month. Yicai polled 11 leading China-based chief economists.

The annual Two Sessions will convene in Beijing early next month, with economists expecting that the gross domestic product growth target for this year may be set at around 5 percent, with the deficit ratio target potentially rising to about 4 percent, while the consumer price index growth target will likely remain below 3 percent.

Given the gap in macroeconomic data and policy announcements, more proactive policies to provide stable support for the real economy will likely be introduced at China's two key annual policy-setting meetings, the economists noted.

Due to seasonal factors, the economists expect new yuan-denominated loans to have surged to CNY4.27 trillion (USD584.5 billion) in January from CNY990 billion (USD135.5 billion) the month before. Meanwhile, they forecast social financing to have jumped to CNY5.96 trillion from CNY2.86 trillion.

Their average growth forecast for M2, a broad measure of money supply that covers cash in circulation and all deposits, rose to 7.44 percent from 7.3 percent. While it is unlikely that the loan prime rate or the reserve requirement ratio for large financial institutions will be cut this month, the People's Bank of China, the country's central bank, may still opt to reduce rates or RRR at an appropriate time this year, the economists said.

The CPI will likely climb 0.45 percent this month from a year earlier, while the producer price index will drop 2.19 percent, the economists predicted. According to data by the National Bureau of Statistics released on Feb. 9, the CPI rose by 0.5 percent and the PPI fell 2.3 percent last month from a year ago due to the effects of the Chinese New Year holiday.

On Jan. 27, the exchange rate of the Chinese yuan versus the US dollar was 7.1698. The economists predict the redback might depreciate slightly by the end of this month, with an average forecast of 7.21, but it will end the year at around 7.13.

Editor: Martin Kadiev