Beijing has announced plans to boost its support for the economy, according to state media. The Politburo, a top decision-making body of the ruling Communist Party of China, made the announcement during a meeting chaired by President Xi Jinping.
The country will continue to implement a prudent monetary policy and proactive fiscal policy, as officials noted that while the economy is showing signs of recovery and improvement, there are still many challenges ahead. Issues such as insufficient demand, pressures on firms, risks, and hidden dangers in key areas of the economy need to be addressed.
To maintain the necessary intensity of fiscal expenditure, China plans to issue ultra-long term special treasury bonds and speed up the issuance of local government special bonds. Additionally, Beijing will take steps to promote the healthy development of the capital market and deepen the implementation of local government debt-risk resolution plans.
In order to support the real economy and reduce overall costs for social financing, China will flexibly use policy tools such as interest rates and reserve requirement ratios. The country will also work to reduce housing inventories and optimize policy measures for new housing projects.
Despite these challenges, officials highlighted that China’s economic foundation is stable with many advantages and strong resilience.
