BEIJING - China's local government debt balance stood at 16.63 trillion yuan ($2.6 trillion) at the end of May, remaining within the official limit, data from the Ministry of Finance showed Wednesday.

The country's top legislative body has decided that the upper limit for local government debt this year should be 21 trillion yuan.

China issued local government bonds worth 355.3 billion yuan in May and 876.6 billion yuan in the first five months of this year, all for debt swaps and refunding.

China has made bond issuance the sole legal way for local governments to raise debt amid the nation's efforts to forestall systemic financial crisis.

With the economy on a firm footing and fiscal revenue increasing, China lowered its fiscal deficit target to 2.6 percent of GDP for 2018, down by 0.4 percentage points compared with 2017, the first drop since 2013.