China Economic Perspectives: Policy loosening entering third stage?

The State Council held a meeting on policy, chaired by PM Li Qiang. The meeting statement said counter cyclical policy supports should be stepped up in light of "the emerged problems existing in the economy now" in order to achieve the annual economic targets. The tone of previous statements on the economy in recent weeks had been mostly more benign; the tone tends to be less benign when policy makers have a greater sense of urgency, which can happen because of more weak macro data and weak equity market performance. Policy measures worth noting include: the rollout of a set of practical and effective incremental policy measures; stepping up interest subsidy programs to expand fixed asset investments and enhance consumption; increasing relending quota for technology innovation and equipment upgrading; rolling out measures to stabilize the real estate market;