China's 2013 GDP growth predicted to hit 7.6%

More downside risks loom.

According to BofAML, 2Q13 GDP growth could be around 7.6%. BofAML fine-tunes 2Q13 GDP growth forecasts to 7.6% from 7.7%, but maintain annual GDP growth forecast at 7.6% in both 2013 and 2014 (as well as 3Q13 and 4Q13 forecasts at 7.6%).

"We do see more downside risks than before, but a downward revision of annual GDP growth is to us not justified yet for two reasons. First, the PBoC has already committed to ending the interbank liquidity squeeze and the State Council has come out asking for growth stability.

Second, we expect the deleveraging of small banks in coming months to have a limited impact on system-wide credit supply as big banks could fill the gap," BofAML said.