Chinese Premier Wen Jiabao (溫家寶) reiterated that the government would maintain curbs on the property market to bring prices down to a reasonable level and that economic policies would be “fine-tuned” to support growth.
Wen also repeated his call to strengthen credit support to the “real economy” and small and medium-sized companies. His comments, posted on the Chinese government’s Web site, were made at a meeting of the Chinese State Council yesterday to discuss its work report to the National People’s Congress next month.
China’s growth is moderating as Europe’s debt crisis and weak US expansion hurt exports and the government’s campaign to rein in inflation and property prices damps output. The nation’s first official data for this year, due today, might show manufacturing contracted last month, adding pressure on the government to step up policy easing.
“We must maintain keen observation and make accurate judgments about the domestic and external economic situations and be on high alert for any signs or trends in the economy,” Wen said at the meeting, according to the statement.
The government will “properly manage the strength, pace and -focus of macro-controls, and fine-tune policies at the appropriate time and with appropriate intensity,” he said.
The central bank held off on a reduction in bank reserve requirements that some economists had predicted would come before the week-long Lunar New Year holiday that ended on Saturday, suggesting officials are cautious on more monetary loosening. The People’s Bank of China has added cash into the financial system through reverse-repurchase operations to support lending.
The government will ensure funding for key projects under construction and maintain steady growth in investment, he said.
“We will consolidate the results of property controls, continue to strictly implement and gradually improve policy measures aimed at curbing speculative demand and push prices to return to reasonable levels,” he said.
Wen said in October the government would “fine-tune” policies as needed amid a deteriorating global outlook and reiterated the pledge on Jan. 3, describing conditions this quarter as “relatively difficult.”
The manufacturing purchasing managers’ index probably showed contraction for the second time in three months, according to a median estimate of 17 economists in a Bloomberg News survey.