Standard Chartered Bank cut its growth forecast for China's gross domestic product this year to 7.7 percent from 8.3 percent, the lender said in the latest outlook report.

 

The London-based lender also trimmed the outlook for GDP growth next year to 7.5 percent from 8.2 percent in its previous projection.

 

"The acceleration of China's 2013 economic growth is taking a little longer than we expected. A disappointing March was followed by a moderately weak April," the bank said in the report.

 

"We expect clearer signs of momentum to emerge in the second half of this year as housing, infrastructure and exports become more supportive."

 

The lender also expects China's central bank to increase interest rates in the last three months of 2013 even though inflation this year is projected at 3.2 percent, lower than the official target of 3.5 percent.

 

"We believe the People's Bank of China will want to and be able to hike rates once the yearly Consumer Price Index reading breaches 4 percent," the report said, adding that "we expect this to occur in the fourth quarter." 

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