For years now China’s economic momentum has been cracking all records. But it is now increasingly being mooted that China could be hit by a sharp slump in growth after the Olympic Games. Is the Chinese economy heading for a hard landing?

China’s real economic growth will peak in 2007 at 11.5 % but will also remain high in 2008 despite the downturn in the US. There is no sign of a soft landing, much less a hard one, for the economy. But in the longer term China’s economy will also lose momentum.

Following several price slumps this year, the Chinese stock market continues to soar.

The latest crash on China’s stock market should not be overestimated in terms of its impact on the country’s economic growth nor indeed should parallels be drawn with the Asian crisis.

A managed float gives both Chinese monetary policy and banks additional leeway. There is much to suggest that the exchange rate is likely to remain on the undervalued side.