China to keep economic stimulus in 2016: Bloomberg

China is expected to keep its stimulus measures including interest rate cuts in 2016 to underpin economic growth, Bloomberg economists has said.
 
"The central bank will likely make two 25 bp cuts in the loan rate and multiple cuts in the reserve requirement ratio in the first half," said the economists in a report called "China's Economy in 2016" reached Xinhua reporters late on Friday.
 
However, "space for rate cut is limited as the deposit rate approaches zero," according to the Bloomberg report.
 
Benchmark interest rates for one-year lending and deposits stand at 4.35 percent and 1.5 percent respectively after a 0.25 percentage point cut in this October.
 
To combat a economic slowdown, China's central bank has cut benchmark interest rates five times since last November and lowered banks' reserve requirement ratio three times since February.
 
The Ministry of Finance has accelerated public spending and rolled out a 3.2 trillion yuan $494 billion debt swap for in-the-red local governments, the Bloomberg report said.
 
"Most recently the yuan has fallen 2.4 percent to 6.4726 in mid-December from 6.3174 at the end of October," said the report.
 
To add liquidity, the Bloomberg report forecast that China's reserve requirement ratio will come down from the current 17.5 percent level next year.
 
The Bloomberg economists expected more pro-growth exchange rate and fiscal policy adjustments next year, adding that China has "enough policy space to keep GDP growth "close to 7 percent, but not for much longer."


Related Stories
Share this page
Touched Sympathetic Bored Angry Amused Sad Happy No comment
About us

Rhythm Media Group is a multi-media company, operating a US-based Chinese daily newspaper, The China Press, and the paper's website - uschinapress.com (which has mobile-app version), as well as a Beijing-based English website Sino-US.com. The group boasts 15 branch offices across the US, and a number of cultural centers focusing on culture-related business in the North America, Chinese mainland, Hong Kong and Taiwan.

Launched in September 2012, the Sino-US.com is designed to serve as a bridge between China and the US, and to keep its readership inside or outside China better informed by providing news and insights on China's current affairs, culture, life, business, people and sports.

Our Partners

About us - Contact us - Copyright - Terms of use - Privacy policy

Copyright © 2012 www.sino-us.com All Rights Reserved

京公网安备11010802011260