PBOC Governor Pan Gongsheng told a financial forum in Beijing on Friday that the LPR will be reduced by 20 to 25 basis points on Monday, the official Xinhua news agency quoted Pan as saying.
The PBOC also on Friday unveiled new measures to inject more than $100 billion into the country's stock market, which helped lift Shanghai's blue chip equity index by 3.6%, while the MSCI Asia ex-Japan index rose 1.6% for its best day since Sept. 26.
China's economic 'data dump' on Friday wasn't as bad as many feared it could have been, and annual GDP growth in the third quarter was slightly above consensus at 4.6%.
But as economist Phil Suttle notes, the past two quarters have been unusually weak, delivering 2.75% growth on a seasonally-adjusted annualized basis, "the weakest two quarter growth rate in modern times" outside of COVID-related shutdowns.
Little wonder Beijing has sprung into action.
Stocks have responded positively, but bond yields are sliding again. They initially spiked higher on hopes the support measures, which include substantial bond issuance, will reflate the economy but 10-year yield is once again within sight of 2.00%.
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