Targeting asset bubbles and risk to be focus

People look at a housing project near the Dianchi Lake in Kunming, Southwest China's Yunnan province, on Oct 21, 2016. [Photo/VCG]

Economic growth has remained sound in the first three quarters, and much headway has been made in reducing excessive production capacity and lowering production costs, said a statement released after a meeting of the Political Bureau of the Communist Party of China Central Committee, presided over by General Secretary Xi Jinping.

However, some problems remain, such as growth gaps between different regions, industries and enterprises, according to a report by China Central Television.

It was agreed at the meeting that facing the "new normal" situation, China should adopt proactive fiscal policy and prudent monetary policy.

The nation should also prevent asset bubbles from continuing to accumulate and resolve economic and financial risks - steps that analysts said became necessary after economic growth stabilized in the third quarter.

China's economy grew by 6.7 percent year-on-year in the third quarter, the same as in the previous two quarters, indicating that the situation has anchored.

"Growth will remain stable in the fourth quarter, but one of the uncertainties is the rising economic and financial risks caused by the abnormal rises in housing prices," said Su Jian, an economist at Peking University.

"Policymakers will pay attention to both growth stabilization and risk prevention," Su added.

Zhang Yiping, an economist with China Merchants Securities, said, "China's policy focus has shifted to risk prevention, as indicated by the recent tightening of the real estate market and policies to cut corporate leverage."

The meeting also stressed pushing forward supply-side structural reform and maintaining "reasonably ample" liquidity in the financial market.