Stimulus package on the way in China

China is signaling new stimulus measures. Among other things, participants at an economic conference in Beijing, including President Xi Jinping, have opened the door to raising the ceiling for the budget deficit in 2025.

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Stimulus package on the way in China
Photo: Florence Lo/AP/TT

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At the economic conference, concluded on Thursday, the group of Chinese top politicians also agreed that interest rate cuts and reduced capital requirements for Chinese banks are needed, reports the state-controlled Chinese TV channel CCTV.

China "will need to maintain economic growth and ensure overall stability in terms of employment and prices" next year, reported CCTV after the meeting.

China will also increase the volume of long-term government bonds and open up for increased bond volumes at local authorities, which are important financing sources for investments in infrastructure and other public investments, according to the channel.

No dates for when different stimulus measures will be implemented and how large the investments will be were announced.

China officially aims for a growth rate of 5 percent this year. But future growth levels are uncertain and most analysts expect growth to continue to slow down going forward.

Weak domestic demand and a prolonged property crisis have contributed to the unexpectedly tough economic development in China, the world's second-largest economy.

New Chinese growth targets and potential budget investments ahead are expected to be presented for the first time in March.

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By TTEnglish edition by Sweden Herald, adapted for local and international readers

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