Nation to step closer to prosperity goal

Trump rumors

Wang Qing, chief economist at Golden Credit Rating International in Beijing, predicted the government will set an annual growth target of 6 to 6.5 percent in its next work report in March.

He said last month's Central Economic Work Conference pointed the way to major tax cuts of about 1.5 trillion yuan ($218 billion).

"These tax cuts will encourage enterprises to invest more and, more important, encourage greater private investment and consumption," he said.

How the global economy fares this year may hinge on what happens in the US.

Some of the stock market turbulence at the end of last year arose from rumors that US President Donald Trump was about to fire Federal Reserve chairman Jerome Powell.

Trump has been openly critical of the Fed's monetary tightening, with four interest rate rises announced last year.

Some observers expect US growth, which hit 4.2 percent in the middle of last year, to slow this year as the boost delivered by Trump's tax cuts begins to wear off.

Douglas McWilliams, deputy chairman and founder of the Centre for Economics and Business Research, a consultancy in London, said the apparent row over interest rate policy is at odds with reality.

"Whatever Trump's intervention, the Fed is not actually going to put up interest rates. If you analyze the situation, now is not the time to put them up," he said.

If there is no reversal, the expansionary phase of the US economy will be the longest ever by July, according to records that were first kept in 1854. It would exceed the 120-month expansion between March 1991 and March 2001, according to the National Bureau of Economic Research in the US.