Eyeing U.S. polls, China considers $1.4 tn debt over next few years

• China’s top legislative body, the Standing Committee of the National People’s Congress (NPC), is considering approving a fresh fiscal package, including 6 trillion yuan raised via special sovereign bonds.
• The 6-trillion-yuan debt will be raised over three years, including 2024, primarily to help local governments address off-the-book debt risks.
• The total amount, to be raised by issuing special treasury and local government bonds, equates to over 8% of the world’s second-largest economy’s output.
• The spending plans suggest Beijing is shifting into a higher stimulus gear to boost the economy.
• The central bank announced aggressive monetary support measures in late September, followed by more fiscal stimulus without specifying financial details, causing global market speculation.