Monetary easing seen by year end

Low levels of inflation leave room for policies to ensure sufficient liquidity

China's modest inflation and increasing capital outflows may lead to further monetary easing at end of the year to ensure sufficient liquidity, observers speculated.

In the first 11 months of the year, the Consumer Price Index averaged 1.4 percent, much lower than the government's ceiling of 3 percent, while deflation in the manufacturing sector ran at 5.1 percent, according to the National Bureau of Statistics.