Economists predict that the Chinese government will further increase expenditure, especially in infrastructure construction to stimulate economic development.
Bloomberg News reported on Friday (June 16) that Nomura Holdings and Standard Chartered Bank economists said that the Chinese government may increase the amount of local government bonds, which allows them to borrow more funds for infrastructureProjects provide funds.The central government may also issue special government bonds like 2020, or use policy banks to stimulate lending.
It is reported that the local government that has been high in debt stations may be very cautious about the introduction of fiscal stimulus policies.However, because of the economic downturn and low business confidence, officials who have been worried that over -providing financial support may rethink.
A person familiar with the matter revealed that the Chinese government's senior management was soliciting the opinions of the business leaders and economists on how to revive the economic issues and held a series of meetings.
The first time the People's Bank of China has cut interest rates for nearly ten months this week.Economists predict that the central bank will further relax the policy by the end of this year.
China Economic Daily on Thursday (15th) on the front page comment article pointed out that macro policies cannot be loose, it is necessary to continue to expand demand and provide more powerful support for the real economy.Strong.
Michael Hirson, a Chinese economist at 22V Research LLC, said in a report that if China is willing to increase the stimulus on Thursday, it has increased its stimulus.However, the main obstacles are currently worried about financial risks, and so far they are unwilling to use the increase of the central government's expenditure to expand fiscal stimuli.
Local government special debt is the main source of funds for infrastructure projects.But since May, local governments have slowed the pace of issuance of special bonds.According to the data compiled by Bloomberg, the total value of 2.1 trillion yuan (RMB, S $ 393.132 million in a contract, the same below) has been issued so far this year, which is less than 33 trillion yuan in the first six months of 2022.
Nomura predicts that Beijing will increase another 500 billion yuan local government special debt issuance quota, which will make the total amount of 3.85 trillion yuan this year.According to Bloomberg data, a new special debt of 4 trillion yuan was issued last year.
Nomura said that the central government can also issue special government bonds and increase policy bank loans.In 2020, China issued 1 trillion yuan for such bonds to resist the crown disease.
Many Chinese official departments also suggest that they will provide more targeted policy support.
The spokesman of the Chinese Ministry of Commerce Shu Ting Ting said on Thursday that it will promote the introduction of a series of policies and measures to support restoration and expanding consumption, and promote the high -quality development of automobiles, home, brand consumption and catering.Meng Wei, a spokesman for the China National Development and Reform Commission, said on Friday that it will quickly formulate and introduce the policy of restoration and expanding consumption -including accelerating the construction of facilities such as charging piles and energy storage and supporting grid transformation to vigorously promote new energy vehicles to go to the countryside.
