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PBOC still only easing with caution

The People’s Bank’s policy announcements today will provide only a small boost for China’s economy. Meaningful improvements in household or corporate borrowing would require substantial rate cuts or a significant change in economic sentiment. Neither seems likely in the near future. Nor would it necessarily be welcome: much of China’s weakness is structural rather than cyclical. Wholehearted loosening would add to China’s debt without having a lasting impact on growth.

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