China raises local government debt ceilings to revive economy

China top legislative body approved a bill on Friday to allow local governments to issue 6 trillion yuan ($838.8 billion) in bonds to swap for off-balance sheet or “hidden” debt over three years, as policymakers sought to spur the sluggish economy.

The standing committee of the National People’s Congress (NPC) approved the bill during a meeting from Nov. 4 to 8.

Finance Minister Lan Foan signalled further stimulus is in the pipeline, but gave few details.

While the announcement of the local government aid was largely in line with market expectations, investors had hoped for more measures to boost sluggish consumer and corporate demand.

U.S.-listed shares of Chinese firms fell in pre-market trade, while China exposed-sectors in Europe also fell. The offshore Chinese yuan was last down around 0.4% ay 7.1746 per dollar.