Wed Sep 25 02:55:00 UTC 2024: ## China’s Stimulus Package Ignites Global Rally

**Hong Kong, Shanghai:** Asian markets soared on Wednesday following China’s announcement of a new interest rate cut and a multi-pronged stimulus package aimed at reviving the country’s ailing economy. The news, coupled with the US Federal Reserve’s recent rate cut, fueled optimism among traders.

Hong Kong and Shanghai, which saw significant gains on Tuesday, continued their upward trajectory, mirroring the record performance on Wall Street. The Chinese government’s move to support the economy, battered by a property crisis and weak consumer spending, further bolstered the positive sentiment.

The People’s Bank of China lowered the medium-term lending facility rate to 2.0 percent, marking the second reduction this year. This followed Tuesday’s announcement of other rate cuts, looser banking regulations, incentives for homebuyers, and the potential creation of a stock stabilization fund.

Analysts hailed the comprehensive package as a significant step toward bolstering the world’s second-largest economy. JP Morgan Asset Management’s Chaoping Zhu said the “sense of urgency” in the measures could signal more policy support on the horizon.

The rally spread across Asia, with Tokyo, Sydney, Seoul, Wellington, and Taipei all experiencing gains.

However, some experts cautioned that China’s fiscal policies need further strengthening to fully revive consumer confidence and spending. Ray Attrill, head of forex strategy at National Australia Bank, highlighted the need for measures to address declining house and equity prices, which directly impact household wealth.

While China’s stimulus is driving market optimism, traders are also looking ahead to Friday’s release of the US personal consumption expenditures index, which could offer insights into the Federal Reserve’s next interest-rate move. The Fed’s recent rate cut has fueled hopes of further reductions as inflation cools and the job market slows.

The prospect of continued interest-rate cuts pushed gold to an all-time high of $1,665.24, attracting investors seeking higher returns and a safe haven from geopolitical tensions.

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