Speculation that China’s weakest quarter of annual economic growth since the global financial crisis will trigger a flood of policy support to fight the downturn misses a crucial point – the taps are already turned on.
The annual rate of GDP growth in the first quarter slowed to 8.1 percent from 8.9 percent in the previous three months, the National Bureau of Statistics said on Friday, below the 8.3 percent consensus forecast of economists polled by Reuters.
China’s stock market rallied despite the disappointing data, on the hope that the poor first-quarter showing would be enough to spur more assistance from Beijing, perhaps easier lending terms or more government spending.
But China’s fiscal policy has been firmly pro-growth since the autumn of 2011 and easier monetary policy in the form of 100 basis points of required reserve ratio (RRR) cuts has given banks some 800 billion yuan ($127 billion) of…
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