CHINESE leaders agreed last week to raise the budget deficit to 4 percent of gross domestic product (GDP) next year, its highest on record, while maintaining an economic growth target of around 5 percent, two sources with knowledge of the matter said.

The new deficit plan compares with an initial target of 3 percent of GDP for 2024, and is in line with a 'more proactive' fiscal policy outlined by leading officials after December's Politburo meeting and last week's Central Economic Work Conference (CEWC), where the targets were agreed but not officially announced.