China May Lower Deficit Rate to 3% Red Line: Times

China may lower its budget deficit-to-GDP ratio to about 2.8-3% in 2022 from the “about 3.2%” set last year, retreating to the 3% red line as the economy gradually normalizes, the Securities Times reported citing Wu Chaoming, the chief economist at Chasing Securities. The high government deposits, due to higher surplus funds carried over from the previous two years, will be a strong support to expand fiscal spending, the newspaper cited Wu as saying. Some analysts expect another issuance of special China treasury bonds this year as a follow-up to CNY1 trillion issued in 2020 immediately following the Covid-19 outbreak, which is not included in the fiscal deficit. About CNY950 billion special treasury bonds are maturing this year, the newspaper said.