China cracking? Economic growth estimate cut below 6%

More experts cut their growth estimates for China on Tuesday as trade tensions simmer between Beijing and Washington.

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Oxford Economics, Bank of America Merrill Lynch and Bloomberg reduced their forecasts for the counry's gross domestic product growth in 2020 to less than 6%, Bloomberg reported.

The numbers, if correct, could prove politically costly for China's ruling Communist Party. President Xi Jinping  wants to double China's 2010 GDP by next year, and growth above 6% is needed this year and in 2020 to reach that goal, according to Bloomberg.

"We now expect China's growth to slow to 6% this year and 5.6% next year," said Chang Shu, Bloomberg's chief Asia economist. "Our lower forecasts are subject to downside risks, given further threatened tariffs, and uncertainty over how the blow to business confidence from the trade war will play out."

The cuts come despite the Trump adminsitration's plans for a meeting with Beijing this month on U.S. tariffs that have driven up the cost of Chinese imports and prompted criticism from an array of American businesses. Trump's latest tariffs on $112 billion worth of Chinese goods started at midnight on Sunday.

The Swiss lender UBS originally estimated expansion of less than 6% in mid-August and further cut its estimate on Tuesday, according to Bloomberg.

Meanwhile, Asian stocks rallied on Wednesday after the Hong Kong government decided to withdraw a proposed bill allowing extradition to China that has sparked months of sometimes violent protests.

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