100,000 Chinese officials attend an emergency video meeting to discuss ways to revive their Covid-hit economy. According to a report in the government controlled Global Times, officials across the country attended this tele-conference to discuss measures to deal with the “complex and grave” economic situation, as outlined by Premier Li Keqiang. He urged authorities to take action in sustaining jobs and reducing growing unemployment.
Li said that some aspects of the negative impacts on the economy may surpass those of 2020, during the initial outbreak of the coronavirus.
Several investment banks, such as UBS, are lowering their GDP forecasts for China this year to 3% from earlier forecasts of 5.5%.
The fiscal and monetary authorities will do everything they can to reverse these negative trends, including lowering bank reserve requirements and relaxing down payment requirements for housing.
This approach worked after 2008, when all the major Central Banks were printing money to revive their economies; but will it work in 2022, when the Federal Reserve is beginning a “money tightening program” in order to contain inflation?