China's gross domestic product ( GDP) is expected to grow 9 percent this year compared with 9.5 percent in 2004, said a report released by the People's Bank of China, the central bank.

The report, cited by Friday's China Securities Journal, also projected that the country's consumer price index (CPI) will grow 2.7 percent in 2005.

There are signs indicating that China's domestic demand is shrinking and that this would lead prices to drop in the future, it said.

However, the report, titled " the current price situation and the future development trend", forecast that housing prices will possibly continue to climb in the future.

It believed that the soaring global oil prices and high prices of metals would have a further impact on China and exert more pressure on the country to increase prices of commodities on the long run.

Source: Xinhua