Qu expects a 50 basis point interest rate cut and a 250 basis point cut in the RRR in the rest of the year, with intensified fiscal support, more municipal bond issues and mobilization of fiscal funds.
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Those hoping for signs of stabilization in China’s flagging economy may find some relief in Tuesday’s report.
The ECB is buying 60 billion euros of mostly sovereign bonds each month to boost growth and inflation in the euro zone.
The euro was last at 1.1246 against the dollar following strong data.
Markit said the services sector had seen its best quarter for four years. “There are structural problems but maybe, just maybe, we’ve turned a corner”.
The index is based on a 100-point scale, with numbers above 50 indicating expansion.
The Eurozone economy revived toward the end of the second quarter despite the threat of a Greek debt default and exit from the currency area, as surveys of purchasing managers recorded a pickup in business activity in June following two months of slowdown. European leaders indicated Greece’s government was getting serious about an agreement following Monday’s emergency summit, giving the indebted nation 48 hours to reach a deal that satisfies creditors.
Optimism appeared in short supply as firms surveyed by HSBC/Markit reported the sharpest reduction in hiring intentions for six years, regardless of Beijing’s efforts to kick-start activity through policy stimulus.
China’s central bank economists are cautiously optimistic, expecting a modest recovery in sequential growth in the second half of the year.
The news from Japan wasn’t any better. The factory sector actually went backwards in June, as the world’s third largest economy continued to struggle after a recession past year.
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