Maritza Cabezas, Senior Economist at ABN Amro, on China's economic outlook and the Yuan

I believe that it is quite possible. We expect China's GDP growth to be around 7, 5%, which is in line with the target set by authorities for 2013. That implies that even though the economy was growing at double digit figures in the past years, currently it is reaching a new normal, but still within the target. Nevertheless, it is also a part of transformation strategy that provides more predominance to consumption than investment.

There most probably will be transformation in the type of products that China is importing as the investment model that was predominant until shortly was highly dependent on the import of industrial and mining commodities. However, I believe that in the long term there will be some changes in this composition and it probably would be more favoring consumption-based products, such as food items. This will mean that economies that are now providing these commodities will also have to go through the transformation processes in order to suit the new demand that China will be having in the long term to satisfy it consumption needs.

We see that there was a strong catch-up in terms of foreign exchange appreciation of the Chinese Renminbi in the beginning of the year. However, this has moderated somewhat since the most recent economic activity reports, which were weaker than markets expected. Nevertheless, the Renminbi continues to be one of the best performing currencies in the region. The more solid export data from July has already strengthened the Yuan further. Thus, we do see some space for modest appreciation, but obviously not in the rates that we have had at the beginning of the year.