ICYMI, comments from Zou Lan, head of the People’s Bank of China’s (PBOC) monetary policy department in an interview with state media outlet Xinhua News Agency on Tuesday:
- said that the PBOC may use open market operations, medium-term lending facilities and reserve requirements among other monetary policy tools to provide “strong” support for reasonable growth in credit
- PBOC will also strengthen its counter-cyclical and cross-cycle policy adjustments to create favorable financial conditions for the country’s economic growth
- PBOC will also take measures to prevent funds from clogging and idling while guiding financial institutions to strengthen their liquidity risk management for stable money market operations
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Rumours of further easing to come from the People’s Bank of China never goes away. The Bank is in a bit of a conundrum though:
- Why the People’s Bank of China can’t ease the economic headwinds away
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Still to come soon:
- PBOC is expected to set the USD/CNY reference rate at 7.1618 – Reuters estimate
*** USD/CNH update (offshore yuan):
This article was written by Eamonn Sheridan at www.forexlive.com.