In order to deal with the worsening economic conditions due to trade war with the US, China has planned to cut tax, increase spending and provide adequate financial support to private and small enterprises. This is the worst phase of China’s economy since the global financial crisis of 2008.
The People’s Bank of China has expressed that it will not allow any change in the value of China’s currency yuan, while maintaining a stable but flexible monetary policy. Central Bank Deputy Governor Zhu Hexin said this while giving information to the reporters about the plans set for the year 2019 in a meeting by top leaders of the country.
By the end of October, the Yuan dropped to a low of 10 years at 6.9756 against the dollar. However, since then, it has strengthened to almost 6.7580. If yuan further falls, then the US can get a chance to complain about China’s currency control.
It is notable that despite the government’s order to distribute maximum debt to banks and promote the expenditure on public works construction, China’s economy grew at just 6.5 percent in July-September.
The government informed on Monday that China’s exports to the US in December have been declining. This decline in exports came from US President Donald Trump due to increase tariffs on Chinese products. China’s trade surplus with US reached $ 323.3 billion in 2018.
After the press conference in Beijing, the stock markets fell around the world, although on Tuesday it improved. Hong Kong’s Hang Seng increased by 1.8 per cent, while the Shanghai Composite Index closed 1.2 per cent higher.