The World Bank on Thursday cut its 2012 China growth forecast to 8.2%, lowering its outlook from January's 8.4% estimate. It said a gradual slowdown was unfolding amid a sharp deceleration in investment growth, softening consumption growth and weak global demand. In its quarterly update report the World Bank said China should guard against a hard landing through fiscal policies designed to support consumption. The Washington-based agency said cutting banks' reserve requirements would be one way to ease credit availability. However, it also said that China's central bank should resist cutting interest rates for the time being, and instead hold such policy actions in reserve in case of a sharper downturn, It noted that real interest rates in China were already accommodative. Among risk factors, the World Bank cited China's housing market downturn and disruptions to growth in Europe and other high-income economies.

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