Skip to main content

Equity rally to boost growth but risks inflating a bubble

Chinese equites surged this week, after state media talked up the value of a stock market rally in countering economic headwinds. Output may benefit in the short-run – at its peak the 2015 rally was adding over 1%-pt to quarterly GDP growth. But the stock market is a blunt policy tool and officials run the risk of inflating a bubble that leaves behind damage when it bursts.

Become a client to read more

This is premium content that requires an active Capital Economics subscription to view.

Already have an account?

You may already have access to this premium content as part of a paid subscription.

Sign in to read the content in full or get details of how you can access it

Register for free

Sign up for a free account to gain:

  • Unlock additional content
  • Register for Capital Economics events
  • Receive email updates and economist-curated newsletters
  • Request a free trial of our services


Get access