China will roll out tools in its policy reserve in a timely way to cope with more economic challenges; as COVID-19 outbreaks and risks from the Ukraine crisis pose a threat to employment and price stability.
Activity in the world’s second-largest economy is beginning to recover after widespread COVID-19 lockdowns in April and early May throttled growth, recent data has shown, but headwinds such as a property market downturn, weak consumer spending and the risk of more COVID outbreaks persist.
The government will implement its existing support measures while improving its policy toolbox, Ou Hong, deputy secretary general at the National Development and Reform Commision, told a news conference. New policy support, depending on the circumstances, can be rolled out in a timely manner, he said.
Ou acknowledged that COVID-19 outbreaks and the Ukraine crisis since March have threatened to undercut growth. And driven up unemployment and inflation.
China’s monetary policy will continue to be accommodative to support economic recovery, People’s Bank of China Governor Yi Gang.
In May, China’s cabinet announced a slew of measures covering fiscal, financial, investment and industrial policies; to wrestle with the COVID-induced damage to its economy.
The policies underscore the government’s determination to prop-up its economy. But analysts say a 5.5% target for growth will be hard to achieve if China sticks with its costly zero-COVID containment strategy.
-Reuters.
