China may raise $850 billion for economic stimulus

China may raise an additional 6 trillion yuan ($850 billion) from special treasury bonds over three years to stimulate a sagging economy, local media reported, a figure that failed to revive sentiment in the country's stock market.

The Caixin Global report, which cited sources with knowledge of the matter, comes after Finance Minister Lan Foan said Beijing will "significantly increase" debt, although the absence of details on the size and timing of the fiscal measures disappointed some investors.

The size of the expected fiscal package has been the subject of intense speculation in financial markets. Chinese shares hit two-year-highs earlier this month on news of the stimulus, before retreating in the absence of official details.

Stocks dipped about 0.3%, suggesting little excitement among investors about the reported amount, although analysts say it would at least stabilize growth in the near-term.

Last month China planned to issue special sovereign bonds worth about 2 trillion yuan ($285 billion) this year as part of a fresh fiscal stimulus.

Data in recent months, missed expectations, raising concern that China may not reach this year's roughly 5% growth target and will struggle to fend off deflationary pressures.

In late September, authorities unleashed monetary stimulus and property sector support measures. Soon after, a meeting of top Communist Party leaders, the Politburo, vowed the "necessary spending" to bring growth back on track.

The Caixin article published said the funds would be partly used to help local governments resolve their off-the-books debts, according to the sources. The reported amount is equivalent to nearly 5% of China's economic output.

The International Monetary Fund estimates central government debt at 24% of economic output. But the fund calculates overall public debt, including that of local governments, at about $16 trillion, or 116% of GDP.