Chinese short-term borrowing rates are too low, helping stoke a new stock bubble. Long rates are too high, thanks to surging government debt issuance. Meanwhile, private-sector borrowing is weak. Facing a similar situation in 2009, the Federal Reserve embarked on large-scale purchases of long-dated government debt to ease borrowing conditions—so-called quantitative easing. Chinese central bank officials deny similar measures are needed, but local media report they are under consideration.

Source: Wall Street Journal March 07, 2019 10:52 UTC