Chinese Prime Minister cites pressured economy, but rejects aggressive measures

China’s economy faces renewed downward pressure, but officials should avoid implementing economic measures in an “aggressive and campaign-like manner,” Prime Minister Li Keqiang said on Monday, according to Chinese media .

The world’s second-largest economy has made an impressive recovery since the pandemic crisis last year, but has since lost steam as it grappled with a slowdown in the manufacturing sector, debt problems in the housing market and Covid-19 outbreaks.

China must step up efforts to stabilize six key areas, including employment, finance, trade and investment, in addition to ensuring people’s livelihoods and the development of market entities and food and energy security, Li said according to the media.

But the government should avoid taking “a campaign-like, aggressive and standardized approach” when implementing economic measures, Li said during a meeting with provincial officials.

The government is studying tax and fee reduction policies, along with some reform measures, to support businesses, Li said.

China’s central bank said on Friday it would keep its prudent monetary policy “flexible and targeted”.

Nomura said some changes to the text of the central bank’s monetary policy implementation report in the third quarter suggest that the bank may become more decisive in monetary easing.

“We expect the chance of a reserve rate cut (RRR) to increase rapidly in the coming months, but we still see the probability of an interest rate cut as very small,” Nomura said in a statement.