Chinese authorities are announcing stimulus packages one after another in order to meet the receding growth target.
The State Council, which is the head of the executive in China, announced on Wednesday a 19-point policy package worth 1 trillion yuan ($146 billion).
According to the package, 300 billion yuan will be provided to state banks to invest in infrastructure projects. Special bonds of 500 billion yuan will be provided to local authorities.
Chinese Premier Li Keqiang stated that they are ready to use all the tools at their disposal.
Goldman Sachs economists, on the other hand, are of the opinion that the last package announced will not accelerate the growth at the 3 percent level.
The slowdown in the rise in the economy brought incentive packages to the agenda.
Last week, Chinese state media announced that local governments are planning to issue bonds of approximately $229 billion to close the budget deficit and fund infrastructure investments in the economic situation worsening with increasing cases and the real estate crisis.
The developments that suppressed the economic activity in the country had come one after another. Kovid cases peaked in 3 months. This indicated that there may be more quarantines. Real-time data showed that home sales continued to decline this month. While the latest data show that expenditures have decreased, some factories paused production due to energy shortages.
Following these developments, some institutions revised their growth forecasts for China downwards. Goldman Sachs cut its growth forecast from 3.3 percent to 3 percent, and Nomura Holdings to 2.8 percent from 3.3 percent. The Chinese government's growth target for this year is around 5.5 percent.
As a result of these developments, the Central Bank of China made a surprise interest rate cut.
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