ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon Print

China will struggle to help economies at home and abroad

High inflation and low central bank reserves prevent sweeping action

| China
The headquarters of the People's Bank of China, pictured on Feb. 3: China has little room to cut rates.   © Reuters

Unlike the Federal Reserve, whose sharp rate cut on Sunday central banks around the world rushed to match, the People's Bank of China has been much more restrained in lowering Chinese interest rates -- and is likely to continue being so well into the foreseeable future.

This is because China has little room to cut rates, thanks to its unbalanced economy and stretched banking system. And China has even less room to ride to the rescue with massive spending, as it did in 2008-09.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

Discover the all new Nikkei Asia app

  • Take your reading anywhere with offline reading functions
  • Never miss a story with breaking news alerts
  • Customize your reading experience

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more