Most institutions expect that China will soon introduce some fiscal stimulus measures to boost growth.

　　With the recently released weak economic data, and the People's Bank of China (PBoC) subsequently cut interest rates as expected, and the government departments and the media have released relevant signals, most institutions expect that China (CHN) will introduce further stimulus measures, including increasing the quota of special bonds of local governments. At the same time, the central government may issue special sovereign bonds as in 2020, or use the national Policy bank to provide credit support. However, it is expected that the scale of these measures will be limited, as local debt levels are already high and the financial issues related to real estate have not yet been resolved.

　　According to the data compiled by Bloomberg, last year, the loans of Municipal bond and Policy bank were 4 trillion and 0.74 trillion respectively, and the special sovereign bonds of the central government issued 1 trillion during the epidemic. Since this year, a total of 2.1 trillion yuan has been issued by Municipal bond, while 3.3 trillion yuan has been issued in the same period last year.

　　Wang Tao, chief China economist of UBS, said: "More financial support is needed, but the strength depends on judgment. They can increase infrastructure spending by providing financial support for local governments."

　　Michael Hesson, a Chinese economist at 22V Research and former US Treasury official in Beijing, said, "If China is willing, it has a lot of room to drive stimulus. The main obstacles are concerns about financial risks and the unwillingness to use the central government's balance sheet to expand fiscal stimulus so far

　　Huang Tianlei, China project coordinator of the Peterson Institute for International Economics, said: "The government seems very reluctant to invest more money in the budget to promote economic growth. If the government is really committed to restoring growth, the central and local governments have available resources and increased spending."