China's stimulus moves not enough, say Yellen and top IMF economist

They argue that the latest measures will not meaningfully boost domestic demand.

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WASHINGTON - China's latest stim ulus measures will not meaningfully boost domestic demand, leaving a major source of trade friction intact, US Treasury Secretary Janet Yellen and International Monetary Fund (IMF) chief economist Pierre-Olivier Gourinchas said on Oct 22.

Dr Yellen and Dr Gourinchas said separately they had not seen any announcement so far from China's central bank and its Finance Ministry that would increase demand enough to absorb excess production and boost growth.

"Our view has been that raising consumer spending in China as a share of GDP (gross domestic product) is really important, along with measures to address problems in the property sector," Dr Yellen said at a press conference at the start of the IMF and World Bank annual meetings in Washington. "So far I would say I haven't really heard any policies on the Chinese side that address that." Dr Gourinchas told a news conference on the IMF's latest forecasts that China's fiscal stimulus measures so far lacked detail and therefore were not included in the IMF's 2024 China growth outlook, which was cut to 4.8 per cent from 5.2 per cent.