China Faces Tension for a More Aggressive Fiscal Policy as the Economy Expands

Finance Minister Liu Kun of China published an article on People’s Daily, stating that with the increasing pressure on the economy, more progressive fiscal policy is needed. This would serve as a protection against the declining country’s development caused by the COVID-19 crisis, which contributed to China’s changes in revenue growth.

China at Present

At this point, significant risks and vulnerabilities are imposed on the country’s social advancement, with increasing downward pressure on the market sectors.

Also, in the 1st quarter of 2020, the country’s fiscal revenue demonstrated a negative growth, which is expected to continue presently, showing an overall lower 2020 growth than the prior year.

Moving Forward

Some key measures that would help would be additional tax cuts for companies to ensure the creation of more jobs to uplift the economy.

The markets are likewise expecting the administration to declare another stimulus package to relieve the economy that is profoundly affected by the pandemic. This is likely to precede the yearly National People’s Congress (NPC) meeting that begins on May 22.

Market Response

The earlier remarks have minimal to zero effect on the market sentiment, as it stays driven by the US-China exchange tensions, a second wave of the pandemic, and rising financial harm worldwide.

Further developments have yet to come as Asian values exchange are trading at a generally lower pace.

Risk Disclaimer:

Information on this page are solely for educational purposes only and is not in any way a recommendation to buy or sell certain assets. You should do your own thorough research before investing in any type of asset. Learn to Trade does not fully guarantee that this information is free from errors or misstatements. It also does not guarantee that the information is completely timely. Investing in the Foreign Exchange Market involves a great deal of risk which may result in the loss of a portion or your full investment. All risks, losses and costs associated with investing, including total loss of principal and emotional distress, are your responsibility.