China implements comprehensive stimulus measures to revitalize economy
Date
9/25/2024 4:18:53 AM
(MENAFN) China's central bank, the People's bank of China, unveiled a broad set of monetary stimulus measures and property market support on Tuesday, aiming to revive an Economy facing significant downward pressure and at risk of missing its growth target for the year.
According to Reuters, this comprehensive package is the latest effort by Chinese authorities to boost confidence in the world's second-largest economy, following a series of underwhelming economic data in recent months. However, analysts pointed out that the measures lack direct support for real economic activity. With weak demand for credit from both businesses and consumers, additional fiscal stimulus may be necessary to complement the central bank's actions in order to achieve the annual growth target of around 5 percent.
The real estate support measures include a 50-basis point reduction in the average mortgage interest rate, a decrease in the minimum down payment requirement to 15 percent for all types of housing, along with other initiatives.
China's property market has been struggling since reaching its peak in 2021. Several developers have defaulted, leaving behind large inventories of unsold apartments and a growing list of unfinished projects. Despite Beijing's efforts to remove restrictions on home purchases and significantly lower mortgage rates and down payment requirements, these steps have yet to revive demand or stop the decline in home prices, which dropped at their fastest rate in over nine years this past August.
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