The China Economic Stimulus Tracker provides a comprehensive timeline of announcements and policy actions implemented by the Chinese government to stimulate economic activity.
In a show of unity, China's top three financial regulators unveil extensive monetary stimulus measures to revive the slowing economy. PBOC Governor Pan Gongsheng announces a cut in a key short-term rate and a planned reduction in the RRR to an average of 6.6%, its lowest level since 2018. Additionally, the PBOC outlines support for the struggling real estate sector, including reducing mortgage costs on up to $5.3 trillion in loans and easing rules on second-home purchases. For the stock market, the central bank pledges at least $113 billion of liquidity support.
To promote the long-term development of China's capital markets, the Central Financial Work Commission and the CSRC jointly issue new guidance focused on expanding the scale and proportion of medium- to long-term capital investments. The guidance emphasizes improving the quality of listed companies while strictly cracking down on illegal activities. It also outlines efforts to foster the growth of public equity funds and support private equity investment funds, including the implementation of a fast-track approval process for ETFs.
President Xi Jinping’s huddle of the 24-man Politburo concludes with commitments to bolster the economy through increased fiscal and monetary support, stabilize the property market, and meet the country’s annual economic goals, including a target GDP growth of around 5% for 2024.
In a high-anticipated press conference, the NDRC announces measures to boost economic growth, largely building on existing policies like increased government investment, support for vulnerable groups, and student aid programs. It plans to expand ultra-long-term government bonds to address local debt and enhance enterprise support but provides no specifics on the additional volume of bond issuance or measures to boost private consumption and investment, disappointing investors and causing fluctuations in China's stock market.
To enhance closer monetary and fiscal policy coordination, China’s central bank and finance ministry hold their first joint working group meeting on the treasury bond trade. They emphasize the importance of bond purchases and sales for liquidity management and agree to expand the monetary policy toolbox through central bank transactions in government bonds.
To restore confidence in China's private economy, the NDRC and the Ministry of Justice jointly release the draft of a widely watched law concerning the promotion of the private sector. The 77-article draft stipulates measures to promote fair market competition, enhance the investment and financing environment, encourage their involvement in scientific projects and technological innovation, and safeguard their economic rights and interests.
China's Ministry of Finance introduces four key incremental fiscal measures that are under review: (1) increase support for local debt resolution, (2) aid major state-owned commercial banks in replenishing core Tier 1 capital, (3) stabilize the housing market, and (4) enhance social support for critical groups. However, no specific figures for the fiscal stimulus are provided, as such figures still need approval from the National People's Congress.
To stabilize China's property sector, Housing Minister Ni Hong unveils China’s latest real estate stimulus measures. These include launching cash-settled urban village redevelopment projects aimed at absorbing housing inventories and expanding the "whitelist" of housing projects eligible for bank financing to $560 billion. Additionally, Minister Ni notes that the housing market has shown signs of reaching a bottom.
To stabilize China's economy, China's top three financial regulators hold meetings with major financial institutions, urging them to boost credit for the real economy, maintain reasonable money and credit growth, support small businesses, lower housing loan rates, and utilize new PBOC tools like swap and lending facilities for share buybacks to enhance capital market stability.
PBOC officially launches a re-lending facility and a swap program as two new monetary policy tools to boost the country's capital market development. The initial re-lending amount is $42.16 billion, with an annual interest rate of 1.75 percent and a term of one year, with the possibility of an extension depending on the situation.
