Bank of China: the global economy is little risk of second bottom.

<P> Bank of China Institute of International Finance report released yesterday predicts second bottom of the third quarter is little risk of the global economy, and inflation remains moderate, but rising inflationary pressures forced some countries will gradually tighten monetary policy. .</ P> <P> Bank of China, compiled by the International Institute of Finance, the global economic performance index, third quarter growth rate of the global economic chain may be essentially flat with the second quarter, quarterly trend of the main features are: the global economy is expected in Q3 .continue to grow, the chain growth rate of about 3.2%, an increase of 3.5%, slightly lower than pre-crisis growth rate; and absolute scale, the first 3 quarters before the crisis the global economy will be more than (Q2 2008) the highest level, .But the crisis does not occur from the potential level of output under the condition of the gap is still about 6%. .</ P> <P> development of the crisis the U.S. dollar as the benchmark, the hedging, to guide financial market trends, the report expects the third quarter, the dollar index will remain high and volatile, may be a callback, but difficult to are substantially short-term .downturn. .Three quarters of international capital flows to emerging markets will continue and the U.S. money markets. .Reports that emerging markets still maintain high economic growth, contribute to the region's capital inflows. .In addition, some emerging economies have started to raise interest rates, do not rule out the "hot money" will be a substantial influx to chase higher returns. .At the same time, the recovery in Europe caused by the slowdown in debt and financial market volatility, while the U.S. economy continues to grow, the relative stability of financial markets, international capital flows may continue in the second quarter trend of the U.S. money markets. .</ P> <P> report also noted that the output gap is too large, will continue to suppress the occurrence of global inflation is expected the third quarter, inflation remains under control in developed countries. .Inflationary pressures will ease in developing countries, mainly due to the economic slowdown will limit the pressure on inflation expectations. .The budget deficit of some developed economies, too much pressure will first consider withdrawing from fiscal policy, tight expenditure; in order to prevent deflation and employment promotion, will continue to maintain a loose monetary policy, short-term interest rates less likely. .Better financial position in emerging markets and faster economic recovery, the ability to maintain the necessary fiscal stimulus to the economy back to trend levels of growth; some countries forced by rising inflationary pressures will gradually tighten monetary policy. .</ P>.