The war of words between China’s state-run media and George Soros – which saw China’s Premier Li Keqiang getting involved – after the billionaire investor’s claims that a hard landing on the mainland was unavoidable continued on Thursday. “It is groundless to be bearish about China’s economy,” said a commentary in the state-run People’s Daily newspaper. “Actually, if there is a chance to closely observe the life of ordinary Chinese people, one can find that there is no sign of any economic slowdown at all, and certainly no forewarning of any collapse,” it said. Past changes in the yuan’s exchange rate were normal revisions within a reasonable range and the stock market volatility, experienced since last summer did not reflect the true state of the economy, it said. The commentary followed the decision by the United States Federal Reserve on Wednesday to keep its interest rates unchanged at its policy meeting. Any change in US interest rates could have an affect on the Chinese economy. The Fed also noted that it “was closely monitoring global economic and financial developments” and assessing their implications for the labour market and inflation. On Wednesday Li had talked up China’s economy and said the allegations that China’s slowdown was affecting the global economy were absurd. “In recent days, there have been many international voices ‘shorting’ the Chinese economy, and some have even claimed that China’s slowdown is affecting the global economy – how absurd [these allegations are],” Li said, in comments published on a government website. The premier added that China’s economic growth remained within a “reasonable range”, and while he did not mention Soros by name, state-run news agency Xinhua was happy to point the finger. It said the Hungarian-born investor had “chosen to turn a blind eye” to reality when he made bearish comments on Chinese economic prospects and Asian currencies at the World Economic Forum in Davos, Switzerland, last week – even if such views were shared by a “considerable” number of short-sellers. READ MORE: Communist mouthpiece accuses billionaire investor George Soros of ‘declaring war against China’ “So why do speculators make claims that run counter to reality? Analysts say it is because either the short-sellers have not done their homework or because they are intentionally trying to create panic to snap up profits,” Xinhua said. Beijing is trying to play up confidence in the world’s second biggest economy, but some cracks have become too wide to ignore. China’s headline GDP expansion has already slowed to its lowest in a quarter of century as the economy grapples with massive debts and widespread overcapacity. In the latest sign of weakness, industrial profits fell 4.7 per cent in December from a year earlier, the seventh consecutive monthly fall and the deepest since August 2015. In whole-year term, profits in China’s industrial sector fell 2.3 per cent in 2015, against an increase of 3.3 per cent in 2014. The benchmark stock market index pared losses in early trading on Thursday after opening down 1.5 per cent. It had tumbled 6.4 per cent on Tuesday, despite the central bank injecting capital into the banking system. The People’s Bank of China set a firmer midpoint for the fifth trading day in a row on Thursday morning, partly to ease the fears fanned by Soros, but have analysts questioned the sustainability of the central bank’s strategy of betting against the market. On Wednesday Li had defended the lower headline growth. He noted that as China was a US$10-trillion economy now, every one percentage point of growth in GDP was equivalent to 1.5 percentage points five years ago and two percentage points 10 years ago. READ MORE: Why stalled reforms are a bigger worry for China’s economy than a hard landing “China is still a developing country, and it will remain at the initial stage of socialism for a long period of time. Those who allege that China has caused international market turmoil really over-estimate China,” Li said. As his predecessor Zhu Rongji, China’s economic tsar during the Asian financial crisis, did in 1998, Li has repeatedly pledged that the yuan has no basis to depreciate sharply, though he has not specified whether he mans depreciation against the dollar or a basket of currencies. “For the Chinese government, the yuan is at or close to its equilibrium level, and there’s no basis for the yuan to depreciate sharply,” said Chen Xingdong, the chief China economist with BNP Paribas in Beijing. “But the market doesn’t buy that, so it has become a game of the government versus the market.” Additional reporting by Wendy Wu