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China to increase budget deficit in 2016 -More Fiscal Stimulus ?

  
Analysis, Education
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China Daily reports that fiscal policy in China will become ‘more forceful’ in 2016

An official statement (issued after a national fiscal work conference) from China says

  • China will increase its budget deficit next year
  • Will gradually raise its fiscal deficit ratio
  • Increase government debt issuance and set a limit for newly increased local government debt
  • Will continue to cut taxes

Expectations are that the budget deficit will rise to 3% of GDP

  • Compared with 2.3% for 2015
  • And 2.1% in 2014-

Note – the official statement the China Daily is reporting on was out on Monday, and its impact may well have already flowed through to the AUD, which was up during European and US trade overnight.

Greece posts bumper $2.4bn budget surplus

  
Analysis, Education
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Here’s something you don’t hear very often. Greece’s public finances are in very healthy shape.

Over the first four months of the year, the Greek treasury boasted a primary budget surplus of €2.4bn. This surplus, which does not include debt interest repayments, came in well above a forecast of just €566m, according to the Greek Ministry of Finance.

After more than 16 months in office, the Syriza government is managing to do exactly what its creditors demand – cut spending and raise taxes. The €2.4bn surplus was also better than the €2.1bn reached over the same period last year.

Athens’ coffers were boosted by better than expected tax revenues, which came in €325m above target at €14.11bn from January to April. Spending meanwhile came in at an impressive €2.28bn below target.

Squabbling over the state of Greece’s primary budget surplus has emerged as the latest sticking point between its international creditors. (more…)

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