Old Xi Jinping speech sparks China monetary easing speculation

Source: theglobeandmail.com theglobeandmail.com

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A sentence from a months-old speech by Chinese President Xi Jinping has sparked speculation the central bank might start aggressively buying government bonds to support the economy, a stimulus measure China has long shunned. But most analysts say the People’s Bank of China (PBOC) will stick with traditional tools rather than resorting to massive liquidity injections through “quantitative easing” (QE), as some major economies such as Japan and the United States have done. Market expectations remain high for more stimulus to boost the world’s second-largest economy, which is showing tentative signs of momentum despite a long-running debt crisis in the...