THE government must take strong stimulus measures to support growth, with the country in a “critical” period of stabilizing its economy, according to a commentary in the Global Times.

On Monday, Chinese shares slumped and the yuan fell despite the government saying it would slash the amount of cash that commercial lenders need to set aside, releasing a net 750 billion yuan (US$108 billion) into the banking system.

The planned cut to banks’ reserve requirement ratios (RRRs) would be the fourth reduction this year as China loosens credit conditions to support businesses and calm market jitters amid an intensifying trade war with the United States.

Economists predicted further RRR cuts ahead, though the central bank is not expected to lower its benchmark interest rates — unchanged since October 2015 — in the near term. China has repeatedly said it will not resort to massive stimulus.

In an English-language commentary, the Global Times wrote that perhaps China is unable to overcome these pressures by simply continuing to fine-tune its economic policy.

“In 2008, the Chinese Government announced a 4-trillion-yuan (US$578 billion) stimulus package to fight the impact of the global financial crisis. Now, the Chinese economy is under even tougher pressure amid escalating trade friction,” it said.

“The government must draw up strong stimulus policies to inject new momentum into the real economy.”

The views in the newspaper, which is run by the People’s Daily, do not necessarily reflect government policy.

The International Monetary Fund yesterday cut its 2019 China growth forecast to 6.2 percent from 6.4 percent, though it kept this year’s estimate at 6.6 percent. China aims to expand its economy by around 6.5 percent in 2018.(SD-Agencies)