Bank of Canada's Poloz plays down risks of dramatic slowdown in China

Speaking on Monday Bank of Canada Governor Stephen Poloz played down fears of a "dramatic slowdown" in China's economy.

He was even "quite optimistic about China and what it means for" Canada.

"The fact that [China's] growth rate has slowed down a little bit shouldn't be the thing that bothers us so much," Poloz said during a question and answer session following a speech at the Calgary Economic Development's 2016 Economic Outlook event, Market News International reported.

That was a more upbeat verdict than delivered in the Bank of Canada's June Financial System Review, when it said that "the transmission of economic and financial stress" from China and other emerging economies had a "medium" probability of occurring, and the effects on Canada, should such a risk materialize, would likely be "moderately severe."

Many oil firms are still revising their longer-term expectations for the price of oil, he added.

In an interview with the Wall Street Journal on Monday night Chinese president Xi Jinping defended recent actions undertaken by his government to stop the rout in the country's stockmarkets. They were necessary to "defuse systemic risks," he said.

Speaking in London on the previous day, Bank of England Governor Mark Carney labelled China's economic miracle over the past three decades as "extraordinary", having helped to helped to lift billions of people around the world out of poverty.

Nonetheless, the Chinese economy’s post-crisis performance has been bolstered by a large build-up of debt, which has more than doubled to reach almost 200% of GDP, Carney added.

On Tuesday, the Chinese Academy of Social Sciences has revised down its 2015 GDP forecast to 6.9% in its summer report, from 7.0% in the spring report, MNI reported.

That followed a 1.0% gain for the Conference Board's Leading Economic Index for China in August to 334.4, after increases of 0.9% increase in July and 0.5% in June.

As of 07:32 the Shanghai Stock Exchange's Composite Index was trading higher by 0.94% to reach 3,186.26.