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BEIJING, July 7 China's economic growth
quickened in the second quarter from the previous three months,
but further modest government support measures will still be
needed, Premier Li Keqiang said on Monday.
Speaking at a news conference with German Chancellor Angela
Merkel, who is visiting Beijing, Li said the Chinese economy
still faces downward pressure and that the government will
increase its usage of targeted measures to boost growth.
His cautiously optimistic remarks may boost market
confidence ahead of China's second-quarter economic report due
on July 16. Analysts polled by Reuters expects China's growth
for the April-June period to have steadied at 7.4 percent.
"China's economic performance in the second quarter has
improved from that in the first quarter. However, we cannot
lower our guard against downward pressures," Li said.
"We will keep up our composure and not adopt strong
stimulus. Instead, We will increase the strength of targeted
measures," the premier said.
To lift China's flagging economic growth, which hit an
18-month low of 7.4 percent in the first quarter of 2014,
authorities have cut taxes, ordered regional governments to
speed up spending and reduced the amount of cash that some banks
have to hold as reserves.
Use of these so-called "targeted measures" are meant to help
areas of the economy with real business needs, and is a
departure from the past when China would cut rates or reserve
requirements for all banks and ramp up spending across the
But on the back of China's rapid credit growth in recent
years, some experts - including the International Monetary Fund
- have urged Chinese authorities to desist from dramatically
loosening policy and focus on pursuing needed reforms.
A series of surveys of China's manufacturing and services
sectors suggests that growth in the world's second-largest
economy may have stabilised in recent months, though a cooling
property sector is now shaping up to be the biggest threat.
Li said authorities will further fine-tune policies and
expressed confidence the government's 2014 growth target of
around 7.5 percent can be met.
But he added that authorities do not plan any massive
(Reporting by Megha Rajagopalan and Aileen Wang; Editing by Kim
Coghill and Richard Borsuk)