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China Expected to Keep Its Deep Pockets Open to Boost Its Economy

  • Economists forecast fiscal deficit will surpass budget target
  • True spending power is seen more than double the budget level
Updated on

China is seen keeping its deep pockets open in the second half and through 2017, despite having front-loaded spending earlier this year, as fiscal policy takes over from broad monetary easing as the major prop to growth.

The central government’s fiscal deficit will surpass the target of 3 percent of gross domestic product set for 2016, according to economists surveyed by Bloomberg News. The broader shortfall that wraps in revenues from land sales, policy banks and other channels will also sink deeper into the red.