BEIJING, Aug 2 Reuters China should ramp up its fiscal stimulus to spur economic growth and set a firm inflation target to prevent the country falling into a low inflation trap, a central bank policy adviser said in remarks seen on Friday.

China39;s leaders signalled this week that fiscal support for the rest of the year will focus on consumption, aiming to boost incomes and social welfare, following plans to use funds from government bonds to finance tradeins on consumer goods.

We need to increase the intensity of macroeconomic policies, especially to implement the already arranged fiscal expenditures as soon as possible, Huang Yiping, a policy adviser to the People39;s Bank of China PBOC, said in an article published by Peking University39;s National School of Development on its Wechat account.

Huang, an influential Chinese economist who heads the school, suggested that if central bank and finance ministry policies are too conservative in an effort to try to maintain policy stability, they could end up undermining economic stability.

If policies are conservative, once they affect economic stability, there will be no more policy stability, he said.

China should quicken fiscal spending and policymakers should shift their stance from prioritising investment over consumption, said Huang, calling for steps to allow more migrant workers to settle in cities and give cash handouts to residents.

The world39;s secondlargest economy grew at a slower than expected 4.7 in…