BEIJING: China’s local governments have issued a net 2.03 trillion yuan ($302.91 billion) in special bonds in the first five months of the year, a finance ministry official said on Thursday.

That means the local governments need to issue 1.42 trillion yuan in special bonds for June if they want to meet the cabinet’s goal, which is largely in line with analysts’ estimations.

China’s cabinet had told local governments on Tuesday to ensure 2022’s 3.45 trillion yuan in special bond issuance for infrastructure is completed by the end of June, bringing the deadline forward by three months in a bid to boost investment.

Analysts say the move could increase pressure on market liquidity and compel the central bank to pump out more money.

“According to bond issuance plans of local governments, they can basically complete the special bond issuance quota by June,” Assistant Finance Minister Ou Wenhan told a news conference on Thursday.

China’s yuan eases, set for third straight monthly loss

The ministry said earlier that local governments had issued 1.85 trillion yuan, or 54% of the total, in special bonds by May 27.

To prop up the COVID-battered economy, Chinese provinces are racing to frontload investment even as policy advisers step up calls for further debt issuance in the second half.