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By Dai Qi

China's economic growth is expected to reach around 6.6 percent, according to a report from the National Academy of Economic Strategy (CASS) released on Tuesday.

The CASS predicted that China's economic growth would slow down mildly to 6.6 percent in the third quarter of this year and to 6.5 percent in the fourth quarter.

In the first three quarters, China's GDP had seen an accumulative increase of 6.7 percent and 6.6 percent for the whole year, according to the report.

"If necessary measures are taken, growth in 2019 will soften to about 6.3 percent," the report estimated.

Wang Hongju, head of the comprehensive economic strategy research department of CASS, said that as China deepened its supply-side structural reforms, production of the industrial and service sectors had seen a stable growth.

The "Purchasing Managers' Index (PMI) of the manufacturing and non-manufacturing sectors and the employment rate are all likely to maintain a stable trend. Meanwhile, China has made achievements in reducing costs and deleveraging," said Wang when summarizing the report at the NAES quarterly meeting on the analysis of the macroeconomic development held by CASS and the Economic Information Daily.

However, challenges to threaten the growth also seem apparent.

"The China-US trade tensions add to uncertainties. Real economies are facing difficulties such as the rising labor costs, tightening funds for small and medium-sized enterprises and the price surge of upstream raw materials in the short term which would squeeze profits for enterprises in the down and mid-stream," said the report.

CASS said it was critically important at the moment to boost confidence and carry out policies on encouraging the growth of the real economy, reducing costs and taxes, as well as preventing financial risks, etc.