In an editorial piece for China’s Communist Party’s magazine, the country’s Finance Minister Liu Kun wrote that Beijing is mulling over tax cuts to cushion the blow of the coronavirus impact on the economy, as it is already showing signs of a slowdown, the UK’s Telegraph reported.
Key Points:
Beijing would use targeted and phased measures to cut taxes such as VAT for firms providing essential goods or logistics, while also providing more funds to contain the disease.
While large-scale rolling back of taxes and fees may increase short.
Meanwhile, the Xinhua news agency cited that a top legislative body of the Chinese parliament will meet on February 24 to discuss a proposal on delaying the key annual March meeting of parliament due to the virus outbreak.
Market Implications:
The Chinese stimulus and containment efforts seem to be cheering the investors, as upbeat risk tones are seen heading into the European open on Monday. The above headlines would add to the market optimism, as USD/JPY tests daily tops near 109.85 while the Aussie keeps gains around 0.6730 amid positive S&P 500 futures.
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