UPDATE 1-China to take more steps to support economy -state media cites cabinet
(Adds details, quotes)
BEIJING, Aug 24 (Reuters) - China will take more steps to support the economy, including increasing funding support for infrastructure projects and ramping up support for private firms and technology companies, state media quoted the cabinet as saying on Wednesday.
China's cabinet will add 19 new policies on top of the existing steps unveiled in May, including raising the quota on policy financing tools by 300 billion yuan ($43.69 billion), state media cited the cabinet as saying after a regular meeting.
China would make good use of carryover special bond quotas of 500 billion yuan and would support centrally owned power generations firms to issue 200 billion yuan in bonds, the cabinet was quoted as saying.
"Currently, the economy continues the recovery trend in June, but the foundation of recovery is not solid," the cabinet was quoted as saying.
Authorities will take "timely and decisive measures, maintain a reasonable policy scale and make good use of policy tools in the toolkit, and intensify efforts to consolidate the foundation for economic recovery," the cabinet added.
But it reiterated that China will avoid excessive stimulus.
China cut its benchmark lending rate and lowered the mortgage reference by a bigger margin on Monday, as Beijing boosts efforts to revive an economy hobbled by a property crisis and a resurgence of COVID-19 cases.
China's economy narrowly escaped a contraction in the June quarter. Economic activity rebounded in June but slowed in July, raising the heat on policymakers to step up support.
In May, the cabinet announced a package of 33 measures covering fiscal, financial, investment and industrial policies to revive the COVID-ravaged economy.
Authorities have given policy banks 800 billion yuan in new credit quotas to fund infrastructure projects, and allowed policy banks to issue 300 billion yuan in bonds to help some key projects meet the minimum capital requirement.
($1 = 6.8666 Chinese yuan) (Reporting by Kevin Yao and Beijing newsroom; Editing by Alex Richardson and Bernadette Baum)
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