Central Bank Led Repo Rate Fell 20 Basis Points

"Under the current economic situation, it is not necessary for the central bank to avoid a comprehensive interest rate cut. Even a comprehensive interest rate cut is based on the stability of inflation expectations and will not change the tone of monetary policy."

A state-owned commercial bank trader said that the downward trend of the 14 day repo bid rate can be seen as a positive signal of the central bank's release. As for the next central bank will continue to cut interest rates or cut interest rates in a comprehensive manner, it depends on the three quarter's economic performance, and the time window will open in October.

Yesterday, the central bank conducted a 10 billion yuan 14 day repo operation in the open market, winning the bid rate of 3.50%, a 20 basis point lower than the latest 3.70% level.

When the 14 day repo in July 31st restarted with the winning rate down by 10 basis points, the central bank announced a targeted interest rate reduction in August 27th.

This once again verifies the previous rule, and the change in the open market interest rate is a precursor to further measures taken by the central bank.

On Tuesday, the central bank carried out a 15 billion yuan 14 day repo operation with a flat interest rate of 3.70%.

The open market is due to expire 33 billion yuan this week, all of which are repo. According to this calculation, the open market will be put in 8 billion yuan this week.

In the market rumors, the central bank released 500 billion yuan of standing loans to facilitate the issuance of repo in the amount of land, so that this week's open market from last week's net return to net investment.

Insiders said that the return of net investment showed that the central bank's stability and strength at the end of the quarter increased, so as to prevent the impact of multiple factors such as the end of 9 IPO, the end of the season, and the preparation of national day long holiday funds.

The SW Institute is optimistic about the future trend of monetary policy.

According to the Institute, the direction of monetary easing is unquestionable under the condition of economic exhaustion.

Whether it is through the guidance of interbank interest rates or the reduction of deposit and lending rates will help to further lower interest rates.

Guan Qingyou, executive director of Minsheng Securities Research Institute, said yesterday that the central bank's SLF injection rate was 3.7%, far below the 3 month Shanghai interbank offered rate of 4.6%, plus the repo rate cut, which would drive the short end interest rate central level down to the middle and long end, thus achieving the same effect as the "interest rate cut".

"In the case of keeping the general keynote of monetary policy unchanged, it should also take the initiative to make fine adjustments in order to meet the needs of the new normal economic situation in China. Whether or not to continue to adopt the directional policy or to comprehensively reduce interest rates or reduce the accuracy depends on the actual situation of economic operation."

The traders of these state-owned commercial banks said, as premier Li Keqiang said, "for those enterprises and industries that need support, they are thirsty, and we should give them some water to drink. This is not a stimulus, but it is also necessary to drink this cup of water to the enterprises.

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Data show that the whole country in August

Up 2%, or 0.3 percentage points lower than in July, a 4 month low, and inflation pressure is at a controllable state.

The slowdown in China's industrial growth has extended from local industries to key areas and the general slowdown in key industries.

In September 17th, the Executive Council of the State Council deployed to further support the development of small and micro enterprises to promote public entrepreneurship and innovation.

Industry analysts believe that inflation control provides a condition for cutting interest rates, while promoting public entrepreneurship and innovation requires reducing the cost of financing. One way is to cut interest rates or cut interest rates.

ANZ Bank economist

It is said that opaque monetary policy operations will increase market volatility.

If the future economic data continue to be poor, it is expected that more monetary easing policies will be launched this year. It is impossible to exclude the possibility that the central bank will completely reduce the 50 base points or reduce interest rates.