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<Research>JPM: CN Politburo Meeting Held at Unusual Timing, Highlighting Urgency; More Impactful/ Larger Stimulus Measures Expected
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The meeting of the Politburo of the Chinese Communist Party came two days after the People's Bank of China (PBOC), China Securities Regulatory Commission (CSRC) and the China Banking and Insurance Regulatory Commission (CBIRC) announced a larger-than-expected stimulus combo on Tuesday (24th), which was unusual, highlighting its urgency, JPMorgan released a report saying. The meeting called for adjustments to fiscal and monetary policies to ensure necessary fiscal spending with measures such as ultra-long-term special national bonds, lower RRR and significant interest rate cuts. The focus of policies is given to stabilizing the real estate market, guiding equity investors to take a long term view and supporting consumption and households. JPMorgan's economists saw Thursday's (26th) move as the entering into the second phase of the stimulus. The first phase was to accelerate the use of the planned deficit spending/ national bond issuance quota for 2024, while the second phase is a lift to the official fiscal deficit target and an expansion of the special national bond issuance quota. The broker forecasted a more impactful/ larger stimulus in the third phase, if any. AAStocks Financial News |
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