China: PBoC cut 7-day reveser repo rates by 20bps – ANZ

The People’s Banks of China (PBoC) cut 7-day reverse repo rates by 20bps today following the Politburo’s meeting last Friday, economists at ANZ Bank report.

Key quotes  

“Today’s cut is intended to lower Chinese corporates’ funding costs, and will be followed by cuts in the medium term lending facility (MLF) rates and loan prime rate (LPR), in our view.”

“A cut in deposit rates is also possible. But the PBoC will observe the impact of this rate cut before taking further action.”

“The next move will probably come after April’s loan data are out, so that Chinese policymakers can assess the effects on the overall loan supply.”