China Introduces Comprehensive Stimulus Measures to Revive Slowing Economy
China: China's central bank announced a broad package of monetary stimulus and property market support measures to boost an economy struggling with deflationary pressures and at risk of missing its growth target for the year. This larger-than-expected package is the latest effort by Chinese authorities to restore confidence in the world’s second-largest economy, following a series of underwhelming economic data in recent months. However, analysts pointed out that the measures lacked direct support for real economic activity.
With businesses and consumers showing weak demand for credit, additional fiscal stimulus may be necessary to complement the steps taken by the People’s Bank of China if growth is to approach this year’s target of around 5%. Following the announcement by Governor Pan Gongsheng, which included plans to lower borrowing costs, inject more liquidity into the economy, and ease mortgage repayment burdens for households, Chinese stocks and bonds surged, while Asian stocks reached 2-1/2-year highs.
Source: China's Central Bank