Oct 9 2024: China’s finance ministry is set to reveal detailed fiscal stimulus measures during a highly anticipated press conference on Saturday, aimed at boosting the country’s economy. The announcement follows a media briefing earlier in the week, which left investors disappointed as no major new steps were introduced to stabilize the faltering economy.
Finance Minister Lan Fo’an will outline the fiscal strategy, focusing on “intensifying countercyclical fiscal policy adjustments to foster high-quality development,” according to the State Council Information Office. The press conference is scheduled for 10 a.m. (0200 GMT).
Chinese markets pared earlier losses following news of the upcoming announcement. Investors have been waiting for clarity on the government’s fiscal plans, especially after the central bank and regulators introduced aggressive monetary stimulus in September, including interest rate cuts and property market support measures.
Premier Li Qiang has held meetings urging improved policy coordination across government departments and has promised specific policy details soon. China’s economy has slowed significantly since the second quarter, with weak household spending and a property sector downturn threatening the country’s goal of achieving 5% growth.
To combat deflationary pressures and sluggish growth, China plans to issue special bonds worth approximately 2 trillion yuan ($283.43 billion) to stimulate household consumption and help local governments manage debt. Additionally, reports indicate China may inject up to 1 trillion yuan into its major state-owned banks to increase their lending capacity, supported by new special sovereign bonds.
Financial markets have been speculating that the fiscal stimulus could be larger than previously expected, and all attention is now focused on Saturday’s press conference for further details.
($1 = 7.0565 Chinese yuan renminbi)