Policy still easing but not enough to hit growth target

Although the Loan Prime Rates were left unchanged on Wednesday, today’s coordinated reductions in commercial bank deposit rates suggest the PBOC is still on an easing path. Meanwhile, a lower headline budget deficit target for 2024 relative to this year’s revised target doesn’t mean policymakers are tightening the noose. But neither fiscal nor monetary policy will provide significant additional support next year. One consequences in that the economy is unlikely to expand by the 5% that the government is reported to be targetin