Premier Li Keqiang said early last month that this was the top task for the government. Earlier, he often emphasized that reform was the top task. The change shows that he now leans toward growth after first-quarter figures missed the yearly target.

Recently, a central bank official said cuts in reserve ratio and interest rates were necessary to prevent the decline in GDP growth from worsening. This shows the government is now open to an interest rate cut.

The loosening stance has translated into increased liquidity. New yuan-denominated lending amounted to 1.08 trillion yuan ($175.64 billion) in June, compared with 870.8 billion yuan in May and 774.7 billion yuan in April. M2, a broad measure of money supply that covers cash in circulation and all deposits, increased 14.7 percent year-on-year to 120.96 trillion yuan at the end of June. The growth rate was at a 10-month high.

Clearly, the credit situation has markedly improved with the government loosening its tight grip.

In the second half of the year, authorities have room to resort to greater loosening if they deem it necessary.

The Consumer Price Index reached 2.3 percent in the first half, well under the safe line of 3.5 percent, allowing the central bank to inject more liquidity.

With government policy support, the yearly target of 7.5 percent is now more secure.

The general weakness in the first half of the year came after the housing market cooled. Growth in fixed-assets investment, much of which usually comes from the property market, slowed. In the first half of the year, the growth was about 17.3 percent, compared with 17.6 percent in the first. This showed that investment was far from recovery.

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