Does the most popular central bank cut the deposit

Does the central bank's reduction of the deposit reserve ratio mean a policy shift

does the central bank's reduction of the deposit reserve ratio mean a policy shift

China Construction machinery information

Guide: This is a piece of heavy news that is somewhat unexpected: on the evening of November 30, the central bank announced that it would reduce the RMB deposit reserve ratio of deposit financial institutions by 0.5 percentage points from December 5. This is the first time that the central bank has lowered the deposit reserve ratio in recent three years. From January 18th, 2010 to 2011

this is a bit unexpected news:

on the evening of November 30, the central bank announced that it would reduce the RMB deposit reserve ratio of deposit financial institutions by 0.5 percentage points from December 5

this is the first time that the central bank has lowered the deposit reserve ratio in recent three years. From January 18, 2010 to June 20, 2011, the central bank has raised the deposit reserve ratio for 12 consecutive times. By raising the reserve ratio of financial institutions by a total of 600 basis points, the central bank has recovered the liquidity whose performance meets the relevant standards and restrained the rapid rise of prices. After the reduction, the deposit reserve ratio of large and medium-sized financial institutions in China was 21% and 17.5% respectively

direct cause: in order to alleviate the tight liquidity situation of the banking system

"the direct cause of the reduction of the deposit reserve ratio this time is to alleviate the tight liquidity of the banking system. Jinan Shijin is specialized in pulling mechanism, which fully reflects the pertinence, flexibility and forward-looking of monetary policy", said Ba Shusong, deputy director of the Financial Research Institute of the development research center of the State Council and chief economist of the China Banking Association

Lian Ping, chief economist of Bank of communications, believes that the current financial situation in the banking industry is tight, and more and more banks' deposit loan ratio exceeds the upper limit of 75%. The central bank requires financial institutions to increase credit to small and micro enterprises in line with industrial policies, "agriculture, rural areas and farmers" and other weak links, meet the capital needs of national key projects under construction and continued construction, and support the construction of affordable housing projects. Even if commercial banks have such aspirations and incentives, they will lack the corresponding lending capacity due to tight positions. "The reduction of the deposit reserve ratio can release 400billion yuan of funds, which is conducive to banks to enhance their lending capacity," Lian Ping said. "Considering the large amount of credit in January next year, which is likely to exceed 1trillion yuan, the reduction of the reserve ratio now reflects the foresight of monetary policy."

on the other hand, the new changes in liquidity also make it feasible to reduce the deposit reserve ratio

first of all, with the decrease of cross-border funds flowing into China and the narrowing of trade surplus, the net decrease of foreign exchange in October was 24.892 billion yuan, which was the first decline in foreign exchange in a single month since December 2007. The amount of foreign exchange is the domestic currency that the central bank puts in when it purchases foreign exchange assets. The increase in the amount of foreign exchange will directly increase the amount of base currency, and through the currency multiplier effect, the RMB in circulation will increase rapidly. "The central bank raised the deposit reserve ratio in order to hedge against the new liquidity brought about by the growth of foreign exchange. Now, the decline of foreign exchange will reduce the supply of market liquidity and open up the space for the reduction of the deposit reserve ratio", Ba Shusong said

secondly, in the past two to three months, the number of bills due from the central bank has decreased significantly, easing the pressure of the central bank on currency hedging and making the deposit reserve ratio lower σ S (PA) means that the tone is possible

release signal: experts believe that steady growth will be placed in a more important position

at present, under the comprehensive effect of a series of policies and measures, the momentum of excessive price rise has been initially curbed, and the policy effect has gradually appeared. "The CPI increase has fallen for three consecutive months, and we expect the CPI increase in November to be less than 4.5%", Ba Shusong said

at the same time, although the internal driving force of China's economic growth is still strong, the external environment is very complex, especially the European sovereign debt crisis is escalating, and the negative impact on China's economic growth may continue to appear. "The PMI index to be released recently may be lower than the 50 of the boom and bust watershed. If so, it will be the first time that the PMI index has fallen below 50 in 23 months," Ba Shusong said

"in this case, the reduction of the deposit reserve ratio releases a signal that we will further deal with the relationship between maintaining steady and rapid economic development, adjusting the economic structure and managing inflation expectations, in which steady growth will be placed in a more important position", Ba Shusong judged

policy orientation: it may be phased and structurally relaxed under the tone of prudent monetary policy. Does the reduction of the deposit reserve ratio mean that the prudent monetary policy begins to turn

Ba Shusong believes that the reduction of the deposit reserve ratio reflects the timely and appropriate pre adjustment and fine-tuning of monetary policy, but it does not mean that the tone of monetary policy has changed. "In an environment where extremely loose monetary conditions in the world will continue, domestic demand expanded rapidly in the previous two years, and there is a large amount of money in stock, there is still uncertainty about the future price trend, and the foundation for price stability is not yet solid. We expect the CPI increase to be 3.5% - 4% for most of next year, which is also a not low increase, and we need to continue to adhere to the implementation of a prudent monetary policy", Ba Shusong said frankly, "However, the reduction of the deposit reserve ratio shows that in the fourth quarter of this year and the first quarter of next year, when China's economic growth slows down and 'hits the bottom', the central bank will make some phased and structural easing under the framework of prudent monetary policy"

future forecast: some experts believe that the deposit reserve ratio may be reduced by less than 5 times before the end of next year

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