In an uncertain monetary environment where the Federal Reserve has yet to announce interest rate cuts, China’s central bank is seeing potential moves to increase activity constrained by pressures on the yuan.
As China prepares for its annual legislative sessions, the methods used last year to prop up economic growth appear less reliable than before, prompting calls for a large-scale re-evaluation of policies and prospects.
The Central Financial Commission has vowed to keep policies in line with international rules and avoid jarring turns in regulation in an attempt to reverse or mitigate 2023’s precipitous drops in stock value and foreign investment.
Although emerging economies as a whole have seen net inflows for their capital markets, overseas investors are still selling their Chinese assets in what analysts have termed a “bifurcation” prompted by heightened perception of risks.