China will release detailed economic policy moves in early September

Vehicles drive through Beijing’s central business district, China April 23, 2018. REUTERS/Jason Lee

BEIJING, Sept 1 (Reuters) – China said it will release detailed steps for newly announced economic policy measures in early September, suggesting policymakers have an urgent need to revive the sluggish economy amid the resurgence of COVID and a troubled real estate sector.

The government will present detailed plans to implement the 19 new measures it announced last week to support growth, as recent factory activity surveys pointed to a further loss of momentum in the world’s second largest economy in August. Continue reading

China will guide commercial banks to provide medium- and long-term loans for key projects and equipment upgrades, state media quoted the cabinet as saying on Wednesday after a meeting chaired by Premier Li Keqiang.

To shore up the weak real estate market, China will also support rigid housing demand, state media reported.

“Local governments should have ‘a policy for one city’ to use the policy instruments wisely” and use the home delivery special credit flexibly, state media quoted the cabinet meeting as saying.

The latest moves, including raising the policy banks’ funding instrument quota by 300 billion yuan ($43.49 billion), come on top of 33 measures unveiled in May.

China’s economy narrowly escaped contraction in the June quarter amid widespread COVID-19 lockdowns, and economists say the nascent recovery risks fizzled out amid fresh virus outbreaks and a distressed real estate sector. Continue reading

Since the end of August, the cabinet has also sent working groups to larger provinces to promote the implementation of the policy.

“It gives local governments more autonomy while asking them to take responsibility for propsing up the real estate market,” Wen Bin and Wang Jingwen, senior economists at Minsheng Bank, said in a note.

($1 = 6.8977 Chinese Renminbi Yuan)

Reporting by Kevin Yao, Ellen Zhang and the Beijing editorial team; Editing by Ana Nicolaci da Costa

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