The Strategist

Reuters: China's budget deficit will reach 3% of GDP

12/18/2023 - 02:25

Chinese leaders decided on the budget deficit for 2024, writes Reuters citing three sources.

The country's GDP will be shorted by 3%, as opposed to 3.8% this year, as reported. The IMF projects that China's nominal GDP will reach approximately $17.7 trillion by 2023.

The modest shift in China's budget deficit for the upcoming year, as reported by experts surveyed by Reuters, indicates that the government wants to uphold "fiscal discipline" and does not intend to utilize big quantitative easing measures or the issuance of huge domestic and international loans to lower the deficit.

Multiple government bond offerings are planned to cover unforeseen expenses, according to two agency sources. A concern is estimated to be worth $146 billion, or almost 1 trillion yuan. "The budget deficit in 2024 will be 3 per cent and the missing parts of spending will be financed with special sovereign bond issues," a source told Reuters.