Limited room for China to tighten policy as debt fear grows - RTRS

Reuters quoting sources familiar with the matter, citing that China's leadership is signaling growth will slow slightly in 2017, as they face the challenge of how to tighten credit to contain debt, speculative investment and outflows without triggering defaults and company failures.

One of the sources noted, "Policy cannot be too loose, but the room for policy tightening is not big. They need to support growth while pushing for deleveraging and preventing bubbles. This is a difficult balance."

Another source said, "Policy could tilt towards slight tightening under the premise of 'prudent and neutral', but conditions for raising interest rates are not ripe."