China Economics Update PBOC steps up rate cuts in response to Coronavirus The People’s Bank has lowered the rates it charges banks for short-run liquidity. Given the mounting toll of the Coronavirus outbreak, we expect more cuts in the coming months. 3rd February 2020 · 2 mins read
China Economics Update Virus outbreak increasingly resembling SARS Even if the coronavirus outbreak is brought under control quicker than SARS was in 2003, the economic impact now looks likely to be of at least a similar scale. We estimate that SARS lowered China’s... 27th January 2020 · 3 mins read
China Economics Update Assessing the impact of the new flu virus in Asia Fears are growing about the spread of a newly-identified coronavirus across Asia. In this Update we discuss the likely implications for the region’s economies. 21st January 2020 · 3 mins read
China Economics Update Loan Prime Rates on hold but cuts still on the horizon The Loan Prime Rate (LPR), the reference point against which banks now price loans, held steady in December. The one-year LPR was unchanged at 4.15% (both the Bloomberg consensus and our forecast were... 20th December 2019 · 2 mins read
China Economics Update The PBOC remains in easing mode The People’s Bank has made another small downward adjustment to the rates it charges banks for short-run liquidity. We expect further cuts in the coming months, which will open the door to lower... 18th December 2019 · 2 mins read
China Economics Update What to expect in 2020 Domestic headwinds will continue to weigh on growth next year, even as the external environment starts to improve. We expect this to trigger additional policy easing, with the PBOC likely to cut rates... 12th December 2019 · 4 mins read
China Economics Update PBOC cuts feed through to lower bank rates The latest Loan Prime Rate (LPR) reductions confirm that banks are lowering lending rates on new loans in response to the recent cuts to the PBOC’s lending facilities. And policymakers’ willingness to... 20th November 2019 · 3 mins read
China Economics Update PBOC nudges down its floor on interbank rates For the first time this easing cycle, the People’s Bank has cut the rate it charges banks for short-run liquidity. We expect further cuts in the coming months, which will open the door to lower... 18th November 2019 · 3 mins read
China Economics Update How much does Hong Kong’s special status matter? If Hong Kong’s special treatment under US law were revoked, the city would lose access to sensitive US technology and face an increased threat of US tariffs. The short-term economic damage would be... 11th November 2019 · 3 mins read
China Economics Update The PBOC’s inflation dilemma The People’s Bank is powerless to stop consumer price inflation jumping above its target without undermining its broader mandate to support growth and employment. Given this trade-off we expect the... 11th November 2019 · 2 mins read
China Economics Update PBOC turning more proactive After keeping interbank rates broadly stable for most of this year, the People’s Bank (PBOC) is starting to take more direct steps to push down borrowing costs. We think this could mark the beginning... 5th November 2019 · 2 mins read
China Economics Update Construction strength offset by industry weakness The detailed breakdown of China’s Q3 GDP data released today shows that a slowdown in industry overshadowed strength in the construction sector. The headwinds to the construction sector should only... 21st October 2019 · 3 mins read
China Economics Update Easing yet to come The newly-revamped Loan Prime Rate (LPR), the reference point against which banks now price loans, was unchanged in October. This will only increase pressure on the PBOC to ease funding costs for... 21st October 2019 · 3 mins read
China Economics Update US and China no closer to a lasting resolution The US is attempting to pluck low-hanging fruit first, rather than hold out for a more complete trade deal with China. But reaching an agreement on the more contentious structural issues remains an... 14th October 2019 · 4 mins read
China Economics Update Another small step towards lower rates The newly-revamped Loan Prime Rate (LPR), the reference point against which banks now price loans, came in slightly lower for September. We think that more decisive cuts will materialize before long. 20th September 2019 · 3 mins read
