China Economy Needs a Dose of ‘Acupuncture’: Ex-PBOC Adviser

Forget big-bang stimulus, China needs “acupuncture-style” treatment to heal its economy that is headed for its slowest pace of expansion in a quarter of a century, says Li Daokui, former adviser to the People’s Bank of China.

“The timing is right for the central policymakers to put together what I call acupuncture-style stimulus, not massive stimulus, to restart the economy,” Li told CNBC on the sidelines of the World Economic Forum in Dalian, China, referring to the ancient Chinese practice of inserting thin needles into the body at specific points for pain relief.

The stimulus needs to hit “key nerve points of the economy” without upsetting its overall tempo, Li, who is now a professor at Tsinghua University, said.
China’s economy has slackened considerably in recent months, with some economists now projecting growth could fall below 7 percent in the third quarter. The world’s second largest economy expanded 7 percent in the first and second quarter.


Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.