Seven percent is a reasonable GDP growth rate for the Chinese economy, which would give room for institutional reform, said Yukon Huang, a senior associate at the Carnegie Endowment for International Peace.

"I think the government is quite right to say our target growth rate for this decade is 7 percent, not 8 percent. They can be a bit relaxed right now because the economy is actually growing at 7.7 to 7.8 percent," Huang said.

"My view is the growth will still go down but it (the central government) can be relaxed because the floor is 7. In the past, the floor was not meaningful. China always grew well above the floor. Now the floor is becoming more meaningful," he added.