China’s deleveraging efforts pose global financial risks, research says

A sudden financial shock may imperil demand, trade and commodity prices


China’s efforts to reduce debt across the economy while safeguarding growth pose risks to global trade and commodity prices, a paper published by the Bank of Spain says.

China’s economic imbalances and the role of the financial sector by Jacopo Timini discusses the challenges the Chinese authorities face in reducing non-financial sector debt and mitigating the risks associated with the excessive growth of the financial system.

The accumulation of debt by state-owned enterprises seeking to meet

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