Citi: China 2quarter growth slowdown blamed on de facto fiscal austerity
Citi said 7in 11a report stated that China’s 2quarter growth slowdown was exacerbated by “de facto fiscal austerity.” This is an assessment that fiscal execution has not kept pace with the economic recovery.
Citi said 7in 11a report stated that China’s 2quarter economic slowdown was worsened by “de facto fiscal austerity.” For investors, this is a matter in which the pace of government spending execution should be seen as directly linked to the economic trend.
The report used the term “de facto fiscal austerity.” With this expression, Citi pointed out that, rather than a short-term formal tightening measure, weakened fiscal execution helped fuel the slowdown.
The report cited the gap between the central government’s policy stance and actual spending execution as a problem. It is an assessment that downward pressure on growth increased amid sluggish execution.
Citi noted in presenting this assessment that macro indicators and policy signals should be reviewed together. Specific figures and additional evidence are provided in the body of the report.
This assessment suggests that the policy response, its speed, and local governments’ fiscal execution could shape the path of the upcoming growth slowdown. Citi’s view is 7based on a report from 11that was dated as a report.
Sources: Investing.com News
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