China's economy is going through a 'slow, painful, grinding adjustment,' analyst says

SINGAPORE — Following a slew of data released over the weekend from China that painted a fairly bleak outlook for its economy, analysts have tapered their expectations for the country's full year GDP growth.

"There hasn't been much good news in this latest round of data, and this has been the pattern for the last few months," said Eswar Prasad, professor of international trade and economics at Cornell University, on CNBC's "Street Signs Asia" on Monday.

"Both the long term issues related to property prices and so on, and the short term issues related to domestic demand in particular, especially private investment and household consumption have not been doing well at all," Prasad said.

He warned that Beijing's economic outlook for the second half of the year is now "flashing red, or pretty close to red."

Duncan Wrigley, chief strategist at Everbright Securities International, said on CNBC's "Squawk Box Europe" that on the "positive side, you could say, given the size of this big housing downturn, what China hasn't seen — say, compared with many other subprime crisis, Japan's big housing downturn — you haven't seen a systemic financial crisis in China, or certainly not globally."

"So to some extent, the Chinese government has managed to insulate this big adjustment in the housing market from the financial sector and prevent a bigger crisis. So instead, they're going through this sort of slow, painful, grinding adjustment," Wrigley added.

Data released Saturday showed that China's retail sales, industrial production and urban investment in August grew slower than expected in August, all missing the expectations of economists polled by Reuters. Urban jobless rate rose to a six-month high, while year-on-year home prices fell at