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☆ Yen weakens past key 145 per dollar level as yuan falls after China PMI data
▼ + stars: | 2023-06-30 | by ( ) www.cnbc.com time to read: +3 min

The yen weakened past 145 per dollar on Friday, a level which kept speculators wary of potential intervention from Japanese authorities, while a faltering economic recovery in China also kept pressure on the yuan. Its renewed decline has stoked speculation that intervention by Japanese authorities could be imminent, particularly as the level of 145 per dollar first prompted them to shore up the yen in September. The onshore yuan fell to its lowest since November at 7.2615 per dollar shortly after trading opened on Friday. The Australian dollar , often used as a liquid proxy for the yuan, slipped 0.12% to $0.6608. The dollar index steadied at around 103.33 and was heading for a gain of about 0.7% in the second quarter.

Persons: Saktiandi Supaat, Maybank's Supaat, Carol Kong, Sterling, Elwin de Groot Organizations: Bank of Japan's, People's Bank of China, New Zealand, U.S, U.S . Federal Reserve, Commerce Department, Commonwealth Bank of Australia, Bank of England, Central Bank, Rabobank Locations: China, Asia, Tokyo, U.S

☆ Dollar holds near 7-month high vs yen on policy split; Swedish crown record low
▼ + stars: | 2023-06-29 | by ( Samuel Indyk | Kevin Buckland | ) www.reuters.com time to read: +4 min

Japanese yen and U.S. dollar banknotes are seen in this illustration picture taken June 15, 2022. The ministry of finance and BOJ intervened in the currency market last autumn when the dollar strengthened beyond 145 yen. “They’re expressing confidence that a faster rate of QT is going to deliver a stronger crown and I think that’s a bit unproven,” ING’s Turner said. The dollar added 0.1% to 7.2492 yuan in the offshore market, taking it close to the previous day’s 7-1/2-month low of 7.2694. The Russian rouble weakened past 87 against the dollar to a 15-month low, hampered by domestic political risk concerns after an aborted mutiny over the weekend.

Persons: Florence Lo, Jerome Powell, Kazuo Ueda, Ueda, “, BOJ, ”, Chris Turner, ING’s Turner, hasn’t, Russian rouble Organizations: U.S, REUTERS, Bank of Japan, ING, Reuters, People’s Bank of, Citi Locations: U.S, there’s, Spain, tomorrow’s, North Rhine Westphalia, Germany’s, People’s Bank of China, Russian

☆ Factbox: Policy measures China's central bank could use to stem yuan weakness
▼ + stars: | 2023-06-29 | by ( ) www.reuters.com time to read: +3 min

** DAILY MIDPOINT SETTINGThe onshore spot yuan can trade in a 2% range around the midpoint set by the PBOC in the daily fix. Weeks later, sources told Reuters that a self-regulatory body overseen by the central bank had told major state-owned banks to lower dollar deposit interest rates and bolster the yuan. It last cut the foreign exchange reserve requirement ratio for financial institutions to 6% from 8% in September 2022 to slow yuan depreciation. ** TIGHTER OFFSHORE YUAN LIQUIDITYTo reduce yuan liquidity offshore, the PBOC issued more yuan-denominated bills in Hong Kong. While the amounts were small, analysts said they sent a clear message guiding expectations for the yuan exchange rate.

Persons: PBOC, Weeks, Winni Zhou, Tom Westbrook, Robert Birsel Organizations: People's Bank of China, Reuters, Thomson Locations: China, State, Hong Kong

☆ Asia pushes back on 'excessive' currency moves amid enduring dollar strength
▼ + stars: | 2023-06-29 | by ( Clement Tan | ) www.cnbc.com time to read: +5 min

Japan finance officials have warned all this week against the "excessive" depreciation of the Japanese yen . Contrasting moves in the world's major currencies — including the Japanese yen, the Chinese yuan and the U.S. dollar — underscore the variance in domestic interest rates and monetary cycles. Authorities may be buying the Japanese yen "with the rise in USD/JPY set to run further," she added. The Japanese currency was hovering at about 144 against the greenback in Asia trade on Thursday. The central bank allows the currency to trade within a narrow band of 2% from each day's midpoint.

Persons: Sheldon Cooper, Carol Kong, Masato Kanda, Shunichi Suzuki, Philip Wee, Adnan Zaylani, BNM, Goldman Sachs Organizations: People's Bank of, Getty, U.S ., U.S, Commonwealth Bank of Australia, Ministry, Bank of Japan's, Reuters, Finance, DBS, greenback, Japan's Finance, Bank Negara Malaysia, Central Bank Locations: People's Bank of China, Asia, Japan, China, Covid, Ukraine, Malaysian, U.S . Federal, Bank

☆ China starts to slow yuan's one-way slide
▼ + stars: | 2023-06-27 | by ( ) www.reuters.com time to read: +4 min

Analysts said that together the moves showed official unease at the yuan's downward momentum and that they could slow but perhaps not halt a decline, given the dour economic outlook. "They are sending more signals now they're uncomfortable ... they would like to slow the yuan weakness," said Moh Siong Sim, a currency strategist at Bank of Singapore. The yuan ended Monday at a seven-month low of 7.2425 per dollar and was at 7.2105 in Tuesday afternoon trade. BACK FOOTThe push back comes as investors sour on China, with data showing China's vaunted rebound faltering. Analysts said moves to halt the yuan's slide were not yet as firm as last year, when regulators rolled out measures to encourage capital inflows, but might be enough to slow selling.

Persons: Yuan, Siong Sim, Stocks, Alvin Tan, We've, Rob Carnell, Carnell, That's, Ankur Banerjee, Tom Westbrook, Rae Wee, Vidya Ranganathan, Kim Coghill, Jacqueline Wong Organizations: People's Bank of China, Analysts, Bank of Singapore, UBS, Australian, Asia FX, RBC Capital Markets, Beijing, Thomson Locations: SHANGHAI, BEIJING, China, Hong Kong, Asia, Shanghai, Singapore

☆ China's state banks seen selling dollars offshore to slow yuan drop - sources
▼ + stars: | 2023-06-27 | by ( ) www.reuters.com time to read: +2 min

SHANGHAI/BEIJING, June 27 (Reuters) - China's major state-owned banks were seen selling dollars in the offshore spot foreign exchange market on Tuesday, four sources with knowledge of the matter said, suggesting authorities wanted to slow the pace of the yuan's recent slide. Such state bank dollar selling appeared as the offshore yuan weakened towards the psychologically important 7.25 per dollar level, two of the sources said. "The 7.25 (yuan per dollar) level remains a key threshold," said one of them, adding a breach of the level could quickly send the yuan to lows last seen in 2022. The yuan's value onshore hit a trough of 7.3280 per dollar in November, levels last seen during the 2008 global financial crisis, while the offshore yuan dropped to a record low of 7.3746. [CNY/]Several currency traders also said they saw state banks selling dollars on Monday just ahead of the onshore domestic close (0830 GMT) to shore up the yuan's closing price, as the rate could determine the next day's official guidance rate.

Persons: China's, Kim Coghill, Vidya Ranganathan Organizations: People's Bank of China, UBS, Federal Reserve, Thomson Locations: SHANGHAI, BEIJING, United States, Shanghai, Beijing

☆ S&P cuts China GDP forecast as calls for stimulus intensify
▼ + stars: | 2023-06-26 | by ( ) www.reuters.com time to read: +3 min

BEIJING, June 26 (Reuters) - S&P Global cut its forecast for economic growth in China this year, underscoring the uneven nature of the country's post-reopening recovery that is spurring more calls for further stimulus. S&P now expects China to log GDP growth of 5.2% in 2023, down from an earlier estimate of 5.5%. Forecasts for China GDP growth this year range between 4.4% and 6.2%. Last week, China cut its key lending benchmarks, the first such reductions in 10 months. Further highlighting pessimism over the economy, China and Hong Kong stocks slumped on Monday after disappointing domestic tourism figures for last week's three-day Dragon Boat Festival, while the yuan also weakened against the dollar.

Persons: Goldman Sachs, Ning, Nie Wen, Liangping Gao, Ryan Woo, Edwina Gibbs Organizations: People's Bank of China, Times, Communist, Hwabao Trust, Thomson Locations: BEIJING, China, Beijing, Shanghai, Hong Kong

☆ China stares hard at its own lost decade
▼ + stars: | 2023-06-23 | by ( Yawen Chen | ) www.reuters.com time to read: +4 min

LONDON, June 23 (Reuters Breakingviews) - China has good reason to hold back on unleashing big stimulus. The central bank has made small cuts to interest rates as everything from credit growth to exports disappoint. For President Xi Jinping, it’s a hard choice between short term gains and his long-term ambition to rebalance the economy. Even if it does issue such bonds, funds may be indirectly used to help poorer provinces repay debt. The Chinese government has set a modest GDP growth target of about 5% for this year after missing its 2022 goal.

Persons: Xi Jinping, Una Galani, Thomas Shum Organizations: Reuters, National Institution for Finance, Development, Wall Street, People's Bank of China, Thomson Locations: China, Beijing

Most economists expect another modest 10 bps LPR cut in the second half - on top of a 25 bps cut in banks' requirement ratio (RRR). The PROC last cut the RRR - the amount of cash that banks must hold as reserves -- in March, by 25 bps. Each 5 basis points LPR cut could reduce pre-tax profits of major banks by as much as 1.8%, China Merchants Securities said in a report. "A small rate cut is a useful painkiller for symptoms but cannot alleviate the real problem," said Gary Ng, Asia Pacific senior economist of Natixis. On Friday, China's cabinet discussed policy measures to support the economy.

Persons: COVID, NIM, Wang Yifeng, Wang, Gary Ng, China's, Zhang Ming, Zhang, Morgan Stanley, Kevin Yao, Ziyi Tang, Kripa Jayaram, Sumeet Chatterjee Organizations: People's Bank of China, Reuters, Everbright Securities, China Merchants Securities, Asia Pacific, stoke, Chinese Academy of Social Sciences, Thomson Locations: China, BEIJING, Beijing, Asia

☆ China cuts lending benchmarks to revive slowing demand
▼ + stars: | 2023-06-20 | by ( ) www.reuters.com time to read: +4 min

REUTERS/Thomas Peter/FILE PHOTOSHANGHAI/SINGAPORE, June 20 (Reuters) - China cut its key lending benchmarks on Tuesday, the first such reductions in 10 months as authorities seek to shore up a slowing economic recovery, although concerns about the property market meant the easing was not as large as expected. The one-year loan prime rate (LPR) was lowered by 10 basis points to 3.55%, while the five-year LPR was cut by the same margin to 4.20%. The People's Bank of China (PBOC) lowered short- and medium-term policy rates last week. "There is no need to roll out all policy measures all at once." Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages.

Persons: Thomas Peter, Julian Evans, Pritchard, Xing Zhaopeng, Xing, China's, Bruce Pang, Jones Lang LaSalle, Winni Zhou, Tom Westbrook, Kripa Jayaram, Sam Holmes Organizations: Central Business, REUTERS, Capital Economics, Reuters, Mainland Properties, People's Bank of China, ANZ, Jones, Graphics, Thomson Locations: Beijing, China, SHANGHAI, SINGAPORE, outpacing

June 21 (Reuters) - A look at the day ahead in Asian markets from Jamie McGeever, financial markets columnist. The one-year loan prime rate (LPR) was cut to 3.55% and the five-year LPR was cut to 4.20%. The yuan has been trading through 7.00 per dollar every day since May 18, and is now approaching 7.20/dollar. On the Chinese corporate front, investors are digesting the news of changes at the top of e-commerce giant Alibaba Group (9988.HK). The main global event for markets on Wednesday is likely to be Fed Chair Powell's semi-annual testimony to the House Financial Affairs Committee.

Persons: Jamie McGeever, Jerome Powell, Kazuo Ueda, weren't, Daniel Zhang, Eddie Yongming Wu, Joseph Tsai, Deepa Babington Organizations: Federal, Bank of, The Bank of Japan, People's Bank of China, Investors, Alibaba, HK, House Financial, Committee, Thomson, Reuters Locations: Asia, Japan

☆ China cuts two more key lending rates as economy sputters
▼ + stars: | 2023-06-20 | by ( Clement Tan | ) www.cnbc.com time to read: +1 min

The People's Bank of China has cut several key policy rates to bolster economic growth in the world's second-largest economy. The People's Bank of China cut two more key lending rates on Tuesday for the first time in 10 months to prop up growth in the world's second largest economy. The Chinese central bank cut the one-year loan prime rate by 10 basis points from 3.65% to 3.55%, and trimmed the five-year loan prime rate by 10 basis points from 4.3% to 4.2% — for the first time since August. "On their own, 10bps cuts are too small to make a great deal of difference to monetary conditions, especially since market interbank rates are already below policy rates," Capital Economics' Julian Evans-Pritchard and Zichun Huang wrote in a note. "But the PBOC tends to use changes in policy rates as signaling tool, with the heavy lifting being done by other tools such as adjustments to reserve requirements and bank loan quotas," they added.

Persons: Julian Evans, Pritchard, Zichun Huang Organizations: People's Bank of, People's Bank of China, Country Locations: People's Bank of China, Hong Kong

☆ China cuts loan prime rate as economic recovery fizzles out
▼ + stars: | 2023-06-20 | by ( Laura He | ) edition.cnn.com time to read: +3 min

The rate cuts come as Wall Street banks, including Goldman Sachs, slash their forecasts for China’s economy. The People’s Bank of China on Tuesday trimmed its one-year loan prime rate (LPR) by 10 basis points from 3.65% to 3.55%, and reduced the five-year rate by the same margin to 4.2%. This is the first time the PBOC has cut both LPR rates since August 2022, when renewed Covid lockdowns and a deepening property downturn were pummeling the economy. “The 10 bps rate cut[s] are unlikely to stimulate business confidence and housing demand,” said Ken Cheung, chief Asian foreign exchange strategist at Mizuho Bank. Hong Kong and mainland Chinese stocks slid after Tuesday’s rate cuts.

Persons: Goldman Sachs, Goldman, Covid, ”, Ken Cheung, “, ” Goldman Sachs, Fu Linghui Organizations: Hong Kong CNN, People’s Bank of China, Mizuho Bank, Shanghai, National Bureau, Statistics, NBS Locations: Hong Kong, Beijing

The PBOC last week lowered short- and medium-term policy rates, paving the way for lower benchmark borrowing costs. Several major banks have cut their 2023 GDP growth forecasts for China to a 5.1% to 5.7% range from an earlier range of 5.5% to 6.3%. Chinese stocks on Monday posted their biggest fall in two weeks, but the weakness was not confined to China. The MSCI World index came off last week's 14-month high, Japan's Nikkei lost 1%, and Hong Kong tech and the MSCI Asia ex-Japan index both had their biggest falls in three weeks. Paramilitary police officers stand guard in front of the headquarters of the People's Bank of China, the central bank (PBOC), in Beijing, China September 30, 2022.

Persons: Jamie McGeever, Antony Blinken's, Tingshu Wang, Lisa Shumaker Organizations: People's Bank of China, Japan's Nikkei, REUTERS, State, Ukraine, Hong Kong, Thomson, Reuters Locations: U.S, Beijing, Malaysian, Hong Kong, China, Asia, Japan, Taiwan, Malaysia

☆ China seen cutting key lending benchmarks as economy slows
▼ + stars: | 2023-06-19 | by ( ) www.reuters.com time to read: +3 min

The People's Bank of China (PBOC) lowered short- and medium-term policy rates last week, signalling it is about to embark on another round of loosening in monetary settings in a push to rev up the recovery. In a poll of 32 market watchers, all participants predicted cuts to both the one-year loan prime rate (LPR) and the five-year tenor . "However, the biggest risk is that rate cuts can be ineffective when households and businesses are excessively conservative, busy deleveraging and paying off debt." China's cabinet met on Friday to discuss measures to spur growth in the economy and pledged to roll out more policy support. Despite strong consensus of cuts to the LPR on Tuesday, market participants are divided on the size of the reductions.

Persons: David Chao, Chao, Li Hongwei, Zhou, Tom Westbrook, Sam Holmes Organizations: People's Bank of China, Reuters, Asia Pacific, Citi, Thomson Locations: SHANGHAI, SINGAPORE, China, Invesco

A number of major banks have cut their 2023 gross domestic product growth forecasts for China after May data last week showed the post-COVID recovery in the world's second-largest economy was faltering. The oil and gas rig count, an early indicator of future output, fell by 8 to 687 in the week to June 16, lowest since April 2022. , , . Earlier this month, OPEC+ had agreed on a new oil output deal. The group's biggest producer Saudi Arabia also pledged to make a deep cut to its output in July. Reporting by Katya Golubkova in Tokyo and Emily Chow in Singapore; Editing by Tom HogueOur Standards: The Thomson Reuters Trust Principles.

Persons: Brent, Tina Teng, PBOC, Edward Moya, Moya, Igor Sechin, Sechin, Katya Golubkova, Emily Chow, Tom Hogue Organizations: NK Rosneft, U.S, West Texas, People's Bank of China's, CMC Markets, Reuters, of, Petroleum, Thomson Locations: TOKYO, United States, China, U.S, Russia, OPEC, Saudi Arabia, Tokyo, Singapore

June 19 (Reuters) - A look at the day ahead in Asian markets from Jamie McGeever, financial markets columnist. Looking ahead and beyond China, investors have two other Asian monetary policy decisions this week to digest - Indonesia's Bank Indonesia (BI) and the Philippines Bangko Sentral ng Pilipinas (BSP) on Thursday. Both are likely to leave policy unchanged, with BI maintaining its benchmark lending rate at 5.75% and the BSP keeping its key policy rate at 6.25%. The broader market tone across Asia on Monday could be one of caution, with investors tempted to take some profits from the recent rally. The annual core CPI rate is expected to ease to 3.1% from 3.4% in April.

Persons: Jamie McGeever, Antony Blinken's, Bank of Korea Governor Rhee Chang, Antony Blinken, Leslie Adler Organizations: People's Bank of, Indonesia's Bank Indonesia, Sentral ng Pilipinas, BI, BSP, Bank of Japan, Bank of Korea, Thomson, Reuters Locations: U.S, People's Bank of China, Beijing, American, China, Philippines, Asia, Japan, Hong Kong

☆ China to boost rural financing, banks should help grain producers, PBOC says
▼ + stars: | 2023-06-16 | by ( ) www.cnbc.com time to read: +1 min

The People's Bank of China (PBOC) building in Beijing, China, on Thursday, Dec. 15, 2022. China will direct more financial resources towards key areas and weak links in rural areas, the central bank said on Friday, in Beijing's latest effort to stimulate a sluggish economy. The People's Bank of China (PBOC) outlined almost 30 measures aimed at backing a stronger agricultural sector, including financing major grain producers to expand their capacity and upgrade their equipment and technology. Financial institutions should also issue medium- and long-term loans to support key areas such as upgrading agricultural facilities and supporting the seed industry, as well as ensuring the production and supply of grain, the statement said. Monetary tools such as re-lending and rediscount facilities will be used to guide financial institutions to enhance lending to the rural sector, the statement added.

Organizations: People's Bank of China Locations: Beijing, China

☆ China's economic recovery is stalling. Here's what to expect next
▼ + stars: | 2023-06-16 | by ( Clement Tan | ) www.cnbc.com time to read: +4 min

watch nowA raft of weak Chinese economic data in May has raised hopes of decisive policy intervention. A slew of economic data from industrial production and fixed asset investment to retail sales and trade fell short of expectations, with China teetering on the brink of deflation as its post-pandemic economic recovery stalls. "Weak investments data suggest that authorities are unlikely to stop at the monetary easing we saw this week," Oxford Economics' lead economist Louise Loo wrote in a note after Thursday's China data release. "We therefore continue to expect announcements of further 'piecemeal' property sector easing measures to follow in the coming weeks," Loo wrote. Goldman Sachs economists said last month that getting young people back to work would give China's economic recovery a sizable boost, given that they account for almost 20% of consumption in China.

Persons: China teetering, Helen Qiao, Louise Loo, Loo, Goldman Sachs, America's Qiao Organizations: China's State Council, Communist, China's National Statistics Bureau, Bank of America's, CNBC, People's Bank of, Oxford, Afp, Getty, Bank Locations: China, People's Bank of China, Chinese, Chongqing, America's

☆ China eyes support for consumer, private sectors as growth falters
▼ + stars: | 2023-06-15 | by ( Kevin Yao | ) www.reuters.com time to read: +5 min

China's cabinet is soliciting proposals from economists and advisers, policy insiders told Reuters, with big changes needing approval from top party leaders, and investors now looking to an expected Politburo meeting in July for clues on policy direction. However, the modest borrowing cost cuts - limited by concerns over banks' profitability and currency stability - will not be enough to boost economic activity, policy insiders said. Authorities are also considering support for the ailing property sector after earlier measures failed to gain traction, including easing credit conditions and home buying curbs in some areas, policy insiders. Economists blame the fading recovery on the "scarring effects" caused by COVID and regulatory curbs on property and tech sectors, which have hit household and private sector spending. Supporting depressed private-sector firms, which account for 60% of economic output and 80% of urban employment, will be essential to lift incomes, jobs and consumption, policy insiders and analysts said.

Persons: Rory Green, Jia Kang, Kevin Yao, Sam Holmes Organizations: quicken, Reuters, People's Bank of China's, TS Lombard, China Academy of New, Economics, Thomson Locations: BEIJING, China, Beijing

☆ Dollar ekes out gain after Fed hike hint; yen slips
▼ + stars: | 2023-06-15 | by ( Samuel Indyk | ) www.reuters.com time to read: +4 min

The Fed's policy decision snapped a string of 10 consecutive rate hikes, but the projections, or dot plot, showed policymakers expect two more increases by the end of 2023. The euro was last flat versus the dollar at $1.0841 after touching a four-week high of $1.0865 on Wednesday. "Dollar-yen is at year highs and markets are increasingly beginning to talk about whether a further rise could trigger the BoJ to verbally and also effectually intervene in the FX market," Lomholt added. Japan's top government spokesperson said on Thursday that volatile currency market moves were undesirable and the authorities would take "appropriate" action as needed. The kiwi dollar sank 0.6% to $0.6172 after data showed New Zealand's economy slipped into a technical recession in the first quarter, putting further rate hikes in doubt.

Persons: Jerome Powell, Fed, Mohit Kumar, Kristoffer Kjær Lomholt, Lomholt, Sim Moh Siong, Samuel Indyk, Rocky Swift, Edmund Klamann, Sohini Goswami, Shweta Agarwal Organizations: U.S, Federal Reserve, European Central Bank, Jefferies, Bank of Japan, Money, ECB, Danske Bank, The Bank of, FX, People's Bank of China, Singapore, Thomson Locations: The Bank of Japan

"In light of what the Fed has announced, it's a hawkish pause," said Bank of Singapore currency strategist Sim Moh Siong. "The message here is that the Fed is tightening, and this is why I think the dollar itself could stay supported in the near term." The yen plunged 0.9% to 141.365 per dollar, and earlier touched 141.430, a level not seen since Nov. 23. The kiwi dollar sank 0.52% to $0.6177 after data showed New Zealand's economy slipped into a technical recession in the first quarter, putting further rate hikes in doubt. "Following the rate cut from earlier this week, there's a lot of expectation for more wide ranging stimulus to shore up the economy," said Bank of Singapore's Siong.

Persons: it's, Sim Moh, Rocky Swift, Edmund Klamann Organizations: U.S ., Federal Reserve, Bank of Japan, Fed, European Central Bank, Bank of, Singapore, People's Bank of China, Singapore's, Thomson Locations: TOKYO, China's, Bank of Japan

Retail sales - a key gauge of consumer confidence - rose 12.7%, missing forecasts of 13.6% growth and slowing from April's 18.4%. Data ranging from factory surveys and trade to loan growth and home sales have shown signs of weakness for the world's second-biggest economy. China's stock markets rose after the rates cut, with the benchmark CSI 300 gaining 0.6% in early trade, while Hong Kong's Hang Seng Index climbed 1.2%. The sector is expected to grapple with "persistent weakness" for years, dragging on economic growth, Goldman Sachs analysts said this week. The country's biggest banks recently cut their deposit rates to ease pressure on profit margins and encourage savers to spend more.

Persons: China's, Zhiwei Zhang, Bruce Pang, Jones Lang LaSalle, Pang, Hong, Julian Evans, Pritchard, Yi, Goldman Sachs, Albee Zhang, Sam Holmes Organizations: National Bureau of Statistics, Jones, CSI, Capital Economics, Investment, Thomson Locations: BEIJING, Beijing, China, outflows

☆ China cuts a key policy rate for first time in 10 months as economic rebound cools
▼ + stars: | 2023-06-15 | by ( Jihye Lee | ) www.cnbc.com time to read: +1 min

BEIJING, CHINA - JUNE 13: A woman walks past the People's Bank of China (PBOC) building on June 13, 2023 in Beijing, China. China's central bank lowered its key medium-term lending rates on Thursday, in a much anticipated move as the economy's post-Covid recovery continues to lose momentum. The central bank last lowered the rate on 400 billion yuan of one-year MLF loans in August, making Thursday's move the first such cut in 10 months. China's medium-term lending facility is a funding channel introduced to allow the central bank to inject liquidity into the banking system and influence interest rates for certain loans. Earlier this week, the central bank cut its seven-day reverse repurchase rate by 10 basis points from 2% to 1.9%, injecting 2 billion Chinese yuan through its seven-day repos.

Organizations: People's Bank of China, People's Bank of, CNBC Locations: BEIJING, CHINA, Beijing, China, People's Bank of China, China's

☆ China cuts medium-term loan rates as economy sputters, more easing expected
▼ + stars: | 2023-06-15 | by ( ) www.reuters.com time to read: +3 min

[1/2] Paramilitary police officers stand guard in front of the headquarters of the People's Bank of China, the central bank (PBOC), in Beijing, China September 30, 2022. Activity data to be released later on Thursday morning was expected to point to further weakness. The cuts could also pave the way for reductions in China's benchmark lending rates when they are set next Tuesday. With 200 billion yuan ($27.93 billion) worth of MLF loans set to expire this month, Thursday's operation resulted in a net 37 billion yuan ($5.17 billion) of fresh fund injection into the banking system. The central bank also injected 2 billion yuan ($279.14 million) through seven-day reverse repos at 1.9%, it said in an online statement.

Persons: Tingshu Wang, skidding, Goldman Sachs, Li Gu, Tom Westbrook, Kim Coghill Organizations: People's Bank of China, REUTERS, BNP, Barclays, Thomson Locations: Beijing, China, SHANGHAI, SINGAPORE, outflows, Shanghai, Singapore

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