China Cuts Rates In Surprise Move As Data Disappoints

In what could plausibly be construed as a somewhat desperate move, China cut two key rates on Monday in an apparent effort to bolster the world's second largest economy amid pervasive doubts around the feasibility of Beijing's full-year growth target. The PBoC cut both the one-year medium-term lending rate and the seven-day reverse repo rate, the first such moves in seven months. The 10bps cut to the MLF rate (figure below) presumably sets the stage for a reduction to the one-year loan prime r
Every story you need, no story you don't. Get the best daily market and macroeconomic commentary anywhere for less than $7 per month. Subscribe or log in to continue.

One thought on “China Cuts Rates In Surprise Move As Data Disappoints

  1. Seems easing works for the matter at hand. But the CCP’s management of the economy loses more credibility every day.

    Sure, they support consumer spending between lockdowns. But then they shoot themselves in the foot with lockdowns, alongside the property and banking issues. Hoping for a 5.5% expansion is crazy. And, to your point, I believe it’s a question whether they’ll expand at all.

    My curiosity is in how they handle all of this. The CCP has asserted itself firmly in managing the economy. Will it continue to assert itself and more so, in a 1984, Aldous Huxley kind of way? Will they ever be inclined again to ease the political pressure and “listen” to the market? And in the longer term, how will they embrace capitalism, if at all?

Speak your mind

This site uses Akismet to reduce spam. Learn how your comment data is processed.

NEWSROOM crewneck & prints