China's Stimulus Surge: Boosting Growth Amid Economic Headwinds

China plans to significantly increase government debt issuance to support low-income subsidies and the property market amidst economic slowdown. Finance Minister Lan Foan indicated substantial fiscal stimulus measures are forthcoming, as China battles deflationary pressures and aims to meet its growth target for 2024.

China announced a major increase in government debt issuance to bolster subsidies for low-income citizens and support the property market, as part of a broad effort to spark economic recovery. The move, spearheaded by Finance Minister Lan Foan, hints at forthcoming substantial fiscal stimulus measures.

The world's second-largest economy is grappling with deflationary pressures, posed by a weakened property market and diminished consumer confidence, which have underscored its reliance on exports. There is concern that the government's 5% growth target for this year may not be attainable, raising fears of a larger structural slowdown.

Recent fiscal stimulus measures were anticipated globally following a Politburo meeting that emphasized urgent economic challenges. However, specifics were absent, leading to apprehension despite Chinese stocks hitting two-year highs. Fresh measures are expected to tackle deeper structural issues, including consumption and over-reliance on debt-driven investment.

(With inputs from agencies.)