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Recent official data highlights a staggering surge in China's total debt, with aggregate financing soaring by 7.06 trillion yuan (approximately $1 trillion) in January 2024—marking the largest monthly increase in Chinese history. Economist Michael Pits from Ping University emphasizes that such debt growth typically indicates economic activity in sectors operating under soft budget constraints. However, the implications are concerning, as this debt surge increased China's debt-to-GDP ratio significantly from 33% to 38% within a month, raising alarms among analysts who suspect the actual debt levels may be even higher with a smaller GDP.