China has announced some of its boldest economic measures in years as its leaders grapple with a prolonged property sector debt crisis and high youth unemployment.
China has yet to achieve a highly anticipated post-pandemic recovery. File picture: Wang Gang / Imaginechina via AFP.China unveiled some of its boldest measures in years on Tuesday aimed at boosting its struggling economy as leaders grapple with a prolonged property sector debt crisis, continued deflationary pressure and high youth unemployment.
The moves represent"the most significant... stimulus package since the early days of the pandemic", said Julian Evans-Pritchard, head of China economics at Capital Economics. The move will inject around a trillion yuan in"long-term liquidity" into the financial market, Pan said.And it will"guide commercial banks to lower the interest rates of existing mortgage loans to the vicinity of the interest rates of newly issued loans".
"The initial scale of the swap programme will be set at 500 billion yuan, with possible expansions in the future," Pan said.Shares in Hong Kong surged more than three percent and in Shanghai more than two percent after China unveiled the measures. Property and construction have long accounted for more than a quarter of China's gross domestic product, but the sector has been under unprecedented strain since 2020, when authorities tightened developers' access to credit in a bid to reduce mounting debt.
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