Chinese Premier Says Government Will Use Monetary Policy to Boost Economy

The Chinese government has additional monetary policy measures that it can take to support economic growth this year, and will even cut “its own flesh” to help finance large-scale tax cuts, Premier Li Keqiang said on Friday.

China has promised billions of dollars in tax cuts and infrastructure spending to help businesses and protect jobs, as economic momentum is expected to cool further due to softer domestic demand and the trade war with the United States.



Li’s comments suggest Beijing is ready to roll out more stimulus measures to ensure the economy grows within a targeted range of 6.0 to 6.5 percent. Gross domestic product grew 6.6 percent in 2018 – the least in 28 years.

Shares on Chinese stock exchanges climbed after the government reaffirmed its commitment to boosting growth. The yuan recovered from a three-week low against the dollar after Li’s comments.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza