30th March 2015
Equities in China hit another seven-year high on Monday, after its central bank hinted at additional stimulus measures. The unveiling of further details of Beijing’s Silk Road infrastructure initiative also helped boost stocks higher.
Shanghai’s share index rose about 2.5 per cent to levels not seen since May 2008, while the Hang Seng index also added around 3.5 per cent.
China’s central bank, The People’s Bank of China (PBOC), hyped up market expectations for even more monetary stimulus to boost the economy.
The PBOC’s governor said that “China can have room to act”, which hints of additional stimulus on the horizon.
Further positive pressure came from the government’s “One Belt, One Road” initiative, which plans to build a modern-day Silk Road to connect Europe and Africa with China. Alongside the building of roads, rails and ports, the plan calls for the construction of oil and natural gas pipelines. Funding will also be given to fibre optic networks, information technology, new energy and bio technology.
Investment for the plan will range between $48 and $64 billion, according to analysts.
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