Chinese policymakers should pursue a proactive fiscal policy and cut interest rates to support flagging economic growth, a financial magazine quoted Sheng Songcheng, an adviser to the People’s Bank of China (PBOC), as saying.

But as China does not face the same deflationary pressures that exist overseas, fiscal policy measures should be the first consideration, with monetary policy playing a supporting role, Yicai quoted Sheng as saying.

The comments comes as debate grows in financial market circles over whether China is moving quickly and forcefully enough to prevent a sharper economic slowdown.

However, consumer inflation has recently quickened to an almost eight-year high of 3.8%, and policy makers remain concerned about rising debt risks, posing a dilemma for the PBOC.

Sheng said a recent jump in pork prices “has certainly inhibited monetary policy, but core inflation and PPI (producer price inflation) remain on a downward trend.”

“Because of this, monetary policy shouldn’t be a flood, but there still is a need for structural adjustments.”