China economy
Last week, OECD revised China's growth outlook to 6.7% for 2015Kim Kyung Hoon/Reuters

The Asian Development Bank (ADB) has trimmed its growth forecast for China and rest of Asia. China is now tipped to grow at 6.8% in 2015, down from the July forecast of 7.2%, and at 6.7% in 2016, down from the previous prediction of 7.0%.

In rest of Asia, excluding the world's second largest economy, growth was pegged at 5.8% and 6% in 2015 and 2016 respectively. This has now been cut from the bank's earlier forecast of 6.1% and 6.2%. ADB is the latest lender to have released a new outlook for the Chinese economy, as last week, the Organization for Economic Co-operation and Development (OECD) revised China's growth outlook to 6.7% in 2015.

"The combination of a moderating prospect in China and India, together with delayed recovery of advanced countries, weighed on our forecast for the region as a whole," Agence France-Presse quoted ADB chief economist Shang-Jin Wei as saying. "Developing Asia is expected to continue to be the largest contributing region to global growth despite the moderation," Wei said while presenting the report at the Foreign Correspondents' Club in Hong Kong.

The Manila-headquartered bank has also cut India's growth forecast by 0.4 percentage points to 7.4% and 7.8% for this year and next. It has urged Asian central banks to strengthen their financial system because of the rise in capital outflow as dealers look for safer US investments ahead of a likely Fed rate hike.

Last week, the Fed kept on hold a rate hike on account of concerns about global growth, specifically the slowdown in China.