China Economists Ramp Up Expectations for Rate Cuts, Spending
- Chinese economists expect fiscal deficit to be as high as 4%
- Sizable rate cuts to come after first policy shift in 14 years
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China may raise its budget deficit to the highest in three decades and make the deepest interest-rate cuts since 2015 following the boldest stimulus signals from its top leaders in years, according to economists.
At least seven Chinese brokerages forecast that next year’s fiscal deficit target could reach 4% of gross domestic product, the widest since a major tax reform in 1994. Beijing has historically kept its budget deficit ratio at or below 3%.