China launches $1.4 trillion debt relief plan for local governments

China has introduced a $1.4 trillion plan to help local governments manage their debt. This program will refinance hidden local debt onto public balance sheets and will be funded through 2028. Despite this significant support, China did not announce new stimulus measures to boost domestic demand. Officials indicated that a more aggressive fiscal policy could be expected next year, particularly in light of potential trade tensions with the incoming Trump administration. Market reactions were mixed, with some disappointment over the lack of immediate stimulus. The offshore yuan weakened initially but later recovered slightly, reflecting investor uncertainty about future economic measures.