BEIJING – If Global Financial Crisis 2.0 would happen today China would probably not come to the rescue of global economy. Such a conclusion can be drown from a commentary published by Xinhua, the major regime’s mouthpiece.
“Market anticipation for more cuts is rising as moderate consumer inflation in July offered sufficient room for such maneuvers,” Xinhua said. “Those hoping for cuts, however, will probably be disappointed.”
Chinese financial policy decision makers are focused on reduction of overcapacity and squeezing out asset bubbles suggested an author of the economic commentary. It also ended hopes of investors, who counted on new rate cuts. Economic stimulus initiated in China could help global economy, which struggles to break out of a prolonged period of sluggish expansion.
Chinese Communist Party repeated in this commentary what has already said on July 21st through Premier Li Keqiang, who emphasised that “the nation faces long-term downward pressure.”
“China is still a developing country — we can’t shoulder the heaviest burden of the world’s economy,”, Li said.
Some Western financial analysts have still high hopes for a rate cuts before the end of 2016.
Reasons for reducing rates by the year end included a housing downturn and slower consumer spending, and signs that s inflation has peaked, according to a report from the Commonwealth Bank of Australia.