The People's Bank of China has decided that starting from October 15, 2018, it has lowered large -scale commercial banks, joint -stock commercial banks, urban commercial banks, non -county rural commercial banks, foreign banks for RMB deposit reserve ratio of 1 percentage point, and the mid -term borrowing expired on the dayConvenience (MLF) will not be continued.
This is the third reduction since 2018.In April and June 2018, the central bank reduced the reserve of 100 and 50 basis points, respectively, and the central bank once again reduced 100 basis points.Since the beginning of this year, a total of 250 basis points have been reduced by a total of 250 basis points.
After this reduction, the reserve rates of large and small deposit financial institutions were 14.5%and 12.5%, respectively.This reduction of about 1.2 trillion yuan of funds, of which MLF 450 billion yuan was used to repay October 15, and it can also release 750 billion yuan in funds.According to the official statement of the central bank, the purpose of this reduction is to support the development of the real economy by reducing the financing cost of SMEs, and the other is to optimize the liquidity structure of commercial banks and financial institutions.
The macro background of this reduction is the further slowing down of the growth rate of the real economy.
No accident, China's GDP growth rate in the third quarter of 2018 will fall to 6.6%, while in the fourth quarter, it may fall further to about 6.4%.The deepening of Sino -US trade friction will further weaken the contribution of the import and export departments to economic growth.Once the export growth rate has fallen due to the impact of trade frictions, this will affect the growth rate of manufacturing investment.The stricter of real estate regulation will lead to the gradual decline in the growth rate of real estate investment.At present, the central government encourages local governments to issue special bonds and encourage commercial banks to purchase special bonds, which can only lead to a moderate rebound in infrastructure investment growth.
The financial background of this reduction is still difficult to financing SMEs.
Although one of the purpose of the two -time orientation of the central bank was to promote financing of small and medium -sized enterprises.However, in the process of stricter financial supervision environment and a large number of banks in banks, commercial banks usually tend to reduce credit support for small and medium -sized enterprises.In the past few months, the growth rate of total social financing was far lower than the growth rate of RMB loans and the growth rate of M1 continued to be lower than the growth rate of M2, which reflected that the difficulty of financing of small and medium -sized enterprises may not increase.It is necessary to effectively reduce the difficulty of financing of small and medium -sized enterprises. On the one hand, the central bank needs to maintain a reasonable and abundant liquidity supply, and on the other hand, the regulatory department needs to support SME financing in terms of regulatory policies. In addition, it also needs to maintain the active equity market.If the lack of the lack of the two people, it is difficult to achieve this goal alone by the central bank.
Another problem reflected by the central bank's reduction is that the central bank does not think that inflation in the short term will become a major threat.
Some time ago, incidents such as rising oil prices, Shouguang Water Disaster, African Pig Epidemic, Sino -US trade frictions, and rising rent in first -tier cities all boosted the market's expectations for economic stagflation.But as we pointed out in the report before, these inflation events are all impact on the supply side. If there is no need to cooperate, the impact of inflation will not be too great in the short term.The central level of the year -on -year growth rate of CPI is expected to increase from 2.0%to about 2.5%in the next year, but there is not much room for continued rise.Although inflation is far -sighted (driven by the price of food prices), there is no near worry.
At the same time as this reduction, the central bank also emphasized that the reduction rate will not cause the RMB exchange rate to face a significant depreciation pressure.
In fact, in the context of the Fed's continued interest rate hike, the relaxation of China's monetary policy will continue to reduce the spread of Sino -US and the United States, making the RMB against the US dollar exchange rate on fundamental depreciation pressure.On the one hand, the central bank's statement shows that the central bank believes that domestic goals should be preferred by foreign goals, and on the other hand, it also shows that the central bank has the willingness and ability to maintain the RMB exchange rate against the US dollar at a specific level.The reorganization of counter -cyclical factor has strengthened the central bank's ability to influence the middle price and various control measures that have been flowing out of capital. In addition, the central bank also retains the ability of foreign exchange reserve intervention and offshore market intervention.In view of this, we believe that the probability of RMB against the US dollar exchange rate at the end of this year is very small.
Another background that the central bank can surrender is that the real estate market has been basically controlled.Affected by the decline in the scale of shantytowns, the real estate market in third- and fourth -tier cities has begun to fall.Affected by the rigorous real estate regulation and bank credit control, the real estate market in some second -tier cities has accelerated, and real estate in first -tier cities maintains the frozen state of price fall and shrinking transaction volume.In addition, the discussion on real estate tax is also affecting the expectations of market entities.As long as the real estate market is regulated, the central bank is expected to have a limited impact on the real estate market.Real estate companies should still be ready for winter.
After this reduction, we predict that the probability of the central bank will continue to decline within this year, and the next reduction may be put in the beginning of the Spring Festival at the beginning of next year.
