All eyes will be on this Tuesday press conference of China’s National Development and Reform Commission (NDRC)when the authorities probably reveal more details about possible fiscal stimuli.
“If the result meets market expectations, it will be critical to determining whether Chinese stocks can continue to rise“, says Richard Tang, analyst for Asia at Julius Baer.
The National Development and Reform Commission of China is a government body responsible for formulating and coordinating economic and social development policies in the country. What he can say tomorrow is key after the People’s Bank of China (PBoC) announced economic stimuli on September 24 and that analysts have stated that, although it is a powerful package of measures, Fiscal measures remain necessary.
The Chinese stock markets have remained closed all last week for holidays and They return to operating normally this Tuesday. What happens at this conference will be decisive to see if they extend the increases that began with the PBoC stimuli.
The theme of the NDRB conference is “systematic implementation of an incremental policy packagesolid promotion of the upward trend of the economy and structural improvement, and sustained improvement in the development trend.” Julius Baer expert emphasizes that this is a “long-awaited” meetingas investors have gradually raised their expectations about upcoming fiscal policies.
“Our recent conversations suggest that investors they may be expecting a fiscal stimulus package of the size of between 2 and 3 trillion yenalthough the information published by ‘Bloomberg’ on Friday may have raised expectations much higher,” says Richard Tang. “The market has built in expectations of some form of cash subsidies for the disadvantaged and/or consumer vouchers, policies to help to alleviate local government funding challenges, at least temporarily, and more policies to address the housing inventory problem.”
