China Needs Loose Policies as Q3 GDP May Slip: News

China should pursue loose monetary policy to counter a slowdown, and the central bank should cut RRRs in due course to enhance banks' lending capacity to new growth engines and weak links of the economy, Yicai.com reported citing Wu Chaoming, chief economist of Chasing Securities.The average forecast for China's Q3 GDP growth is 5.35%, with the expectation of annual GDP forecast revised to 8.15% from 8.72%, as real estate regulations and power cuts will continue to weigh on the economy, Yicai said. Real estate investment and exports, the two main drivers of the recovery from the epidemic, may head downward, while power cuts could affect production and further suppress supply and demand, with the risk of stagflation rising, the newspaper said citing Luo Zhiheng, deputy dean of Yuekai Securities Research Institute.