China's monetary and fiscal policy
Reverse repurchase: the central bank announced that in order to maintain the reasonable and abundant liquidity of the banking system, a 7-day reverse repurchase operation of 10 billion yuan was carried out by means of interest rate bidding on May 13, with a bid winning interest rate of 2.10%. On the same day, the 10 billion yuan reverse repurchase is due, so the maturity of the day is fully hedged; A total of 20 billion yuan of reverse repo expired in the central bank's open market this week. The central bank conducted a total of 50 billion yuan of reverse repo in the open market this week, so a net investment of 30 billion yuan was put in that week. (issued by the central bank)
Economic data: the central bank pointed out that from the financial statistics in April, the financial support for the real economy is stable. In the first four months, the new loans increased by 8.9 trillion yuan, the second highest level in the same period in history. The growth of RMB loans slowed down significantly in April, with a significant year-on-year increase, reflecting the further impact of the recent epidemic on the real economy, the superposition of factors such as the shortage of factors and the rise of production costs such as raw materials. Enterprises, especially small, medium-sized and micro enterprises, had more operating difficulties, and the demand for effective financing decreased significantly. From January to April, the enterprise loan interest rate was 4.39%, a year-on-year decrease of 0.25 percentage points, maintaining the low level since the statistical records. In April, RMB deposits increased by 90.9 billion yuan, an increase of 816.1 billion yuan year-on-year. (issued by the central bank)
Overseas monetary and fiscal policy
[Federal Reserve] Federal Reserve Chairman Powell said on Thursday that controlling inflation may have some negative effects on the economy, but it is still the top priority of the Federal Reserve. Inflation returns to 2% while maintaining a strong labour market, which is now quite challenging to achieve. At the same time, it was reiterated that it was reasonable to raise interest rates by 50 basis points at the next two meetings.
[Mexico] the Central Bank of Mexico raised interest rates by 50 basis points to 7%, in line with expectations. The Central Bank of Mexico expects inflation to peak at 7.6% in the second quarter of 2022.
[Malaysia] the Central Bank of Malaysia said that in the first quarter, China's GDP increased by 5.0% year-on-year, and the market is expected to increase by 4.0% year-on-year; The overall expansion of activities in the first quarter was mainly driven by services and manufacturing; The GDP growth forecast for 2022 remains unchanged, at 5.3% - 6.3%.
[European Central Bank] European Central Bank Vice President jindos said that the European Central Bank will definitely stop buying bonds in July; The rise of commodity prices has a great impact on economic growth; There will be no recession in the eurozone.
[Japan] tokuhiko Kuroda, governor of the Bank of Japan, said that Japan still has not achieved a sustainable stable inflation rate of 2%, and the Japanese economy is still in the middle of the recovery of the epidemic. Now it is important to support economic recovery through easing policies, and it is extremely important to maintain foreign exchange stability. It is too early to discuss withdrawing from easing measures, and different economic entities are affected by foreign exchange fluctuations.
Risk tip: the epidemic spreads beyond expectations, overseas tightens beyond expectations, and global inflation intensifies
