Chinese Premier Wen Jiabao warns of 'difficult' start to 2012 "The first quarter of the year may be quite difficult," Mr Wen said, according to a statement by the State Council, China's cabinet. Beijing is anxious to prevent a sharp slowdown in the economy but at the same time it wants to avoid reigniting inflation, which hit a more than three-year high of 6.5pc in July but has since slowed. China's economy grew an estimated 9pc or more year-on-year in 2011, the official Xinhua News Agency said recently - slower than 2010, when annual growth was more than 10pc. The economy is widely expected to slow even further this year. In a bid to boost growth and counter turmoil in Europe and the US, leaders have cut the amount of money banks must hold in reserve for the first time in three years. Last month, China's leaders also vowed to maintain "prudent" monetary policies after a major meeting to set the nation's economic course in 2012, and agreed to "guarantee steady growth" - a pledge reiterated by Mr Wen.