He said the profit margin of China's steel industry will slip to less than 3 percent this year from 6.93 percent last year, mainly due to the impact of soaring iron ore prices, although imprudent output expansion from some steel mills is also a factor.

Steel mills should curb imprudent output expansion, and the industry should strengthen reuse and recycling of scrap steel to reduce reliance on foreign iron ores, he said.

They signal that market-based reforms may soon lead to stronger support for tech companies and an overhaul of imprudent investor behavior.

Wu Ge, chief economist at Changjiang Securities, called the US Treasury's move "an imprudent decision".

Responding to forestalling and controlling risks, the official said institutions that severely violate laws and regulations and operate in an imprudent manner will face tough punishment.

"China's financial supervision will become increasingly strict, with tougher punishment for market irregularities and imprudent operations," said Wang Zhaoxing, vice chairman of the CBRC, at the annual meeting of China's city commercial banks.

"China's financial supervision will be increasingly stricter, with tougher punishment on market irregularities and imprudent operations," he said at the annual meeting of China's city commercial banks.