SHANGHAI (Reuters) – China stepped up fiscal support and accelerated the pace of government bond issuance to the highest on record in the first quarter of this year, according to Reuters calculations based on official data.
WHY IT’S IMPORTANT
Market watchers believe China will adopt a more expansionary fiscal policy to stabilise economic growth this year as higher tariffs and lingering trade tensions with the United States could take tolls on economy.
BY THE NUMBERS
The finance ministry issued a total of about 3.28 trillion yuan ($451.56 billion) worth of government bonds in the January to March period of this year, the highest level on record, according to Reuters calculations based on official data.
Excluding maturities, government bond issuance rose to 1.45 trillion yuan on a net basis in the first quarter of 2025, tripling the amount during the same period a year earlier and booking the highest quarterly issuance on record.
Sun Binbin, analyst at Caitong Securities, said total bond issuance, which includes government bonds, special treasury bonds and local government bonds, would amount 11.36 trillion yuan this year, 2.4 trillion yuan more than that in 2024.
CONTEXT
Beijing plans to issue 1.3 trillion yuan in ultra-long special treasury bonds this year, up from 1 trillion yuan in 2024. Local governments will be allowed to issue 4.4 trillion yuan in special debt.
Earlier in March, finance minister Lan Foan left the door open to more stimulus measures if the higher budget deficit and debt issuance plans announced during the National People’s Congress were deemed insufficient in the future.
($1 = 7.2637 Chinese yuan)
(Reporting by Shanghai Newsroom; Editing by Alison Williams)
