The level of risk facing China’s financial system could be higher than was seen in the United States before the global crash, according to a former Chinese finance minister. Speaking at a forum in Beijing over the weekend, Lou Jiwei, now chairman of the National Social Security Fund Council, also described the state of China’s financial sector as “messy”.
China has hosted the signing ceremony of the Asian Infrastructure Investment Bank (AIIB), a new international financial institution set to rival the World Bank and Asian Development Bank. Delegates from 50 countries signed articles that determine each member's share and the bank's initial capital.
China's economic growth slowed in the April to June period, the second straight quarter of weaker expansion. The world's second biggest economy grew by 7.5% compared to the previous year, down from 7.7% in the January to March period, data showed. The figures were in line with analyst expectations.
China and Brazil signed an agreement to do billions of dollars of trade in their local currencies, as the five-nation BRICS forum of emerging market powers work to lessen dependence on the US dollar and Euro.
China has cut its key interest rates for the first time since 2008, in an attempt to boost its slowing growth. The benchmark one-year loan rate was cut by a quarter of one percent to 6.31% while deposit rates were cut from 3.5% to 3.25%.
The head of China’s 410 billion dollars sovereign wealth fund CIC brushed aside a call by German Chancellor Angela Merkel to buy European government debt, saying such investments were difficult for long-term investors.