Our news (reporter Liu Yang) on the 20th, the people’s Bank of China authorized the national interbank lending center to announce that the quoted interest rate (LPR) of one-year loan market is 3.7%, and the LPR of more than five years is 4.6%. The above LPR is valid before the next LPR release. This is a synchronous reduction of the two LPR varieties after a lapse of 21 months. The last synchronous adjustment was in April 2020.
According to wind statistics, since the LPR reform in August 2019, the 1-year LPR has been reduced for 7 times, with a cumulative reduction of 61 basis points, and the varieties over 5 years have been reduced for 4 times, with a cumulative reduction of 25 basis points. Among them, the decline of LPR quotation in April 2020 is the largest since LPR reform, with a decrease of 20 basis points in one-year period and 10 basis points in more than five-year period.
At the same time, the data show that since the LPR reform in August 2019, the LPR for one-year and five-year periods has been reduced simultaneously only four times, 5 basis points in November 2019, and 20 basis points in one-year period in February 2020, A 10 basis point reduction over a 5-year period; In January 2022, it will be reduced simultaneously, but the range is different. It will be reduced by 10 basis points in one-year period and 5 basis points in more than five-year period.
\u3000\u3000 “The decline of LPR this time has the effect of reducing the loan interest rate of real enterprises compared with that in December 2021, but there are some differences in policy significance. The driving force of the previous decline of LPR comes from the contraction of the increase range, which more reflects the comprehensive effect of monetary policy in the past period. The driving force of this decline of LPR is the reduction of MLF interest rate, which is the policy interest rate of the central bank, This will more strongly release the signal of sufficient force of monetary policy. ” Zhang Xu, chief fixed income analyst, said on the 20th.
Northeast Securities Co.Ltd(000686) Shen Xinfeng, chief Macro Analyst, said that the essence of this round of LPR interest rate reduction came from the reduction of MLF policy interest rate on January 17. The reduction of the current policy interest rate can be understood from the perspectives of China and foreign countries.
\u3000\u3000 “As far as China is concerned, four hidden worries in the current macro-economy are becoming increasingly prominent: first, real estate investment is still accelerating; second, consumption is relatively fragile under the epidemic; third, the current production and manufacturing investment is highly dependent on exports, and the boom is mostly concentrated in intermediate and capital goods related industries; fourth, credit and social finance is stable but not wide, and the financing demand is low, Lack of economic vitality. From abroad, the hawkish atmosphere of the Federal Reserve is becoming more and more intense, and the time window for China’s monetary policy is limited. A 10 basis point policy interest rate reduction may be more appropriate. ” Shen Xinfeng further believes that.
So, what information is released by the asymmetric reduction of 1-year and 5-year LPR interest rates?
\u3000\u3000 “As the benchmark interest rate for quotation, the five-year LPR plays a role as a policy weathervane to a certain extent, and the release of China’s real estate is a support rather than a stimulus. Real estate is stable and firmly curb real estate speculation. At the same time, the policy should not harm the normal and reasonable financing, house purchase and housing demand, and meet the demand for just needed and improved housing. The reduction of the one-year LPR quotation interest rate is much higher than that of the five-year period , the focus of releasing the central bank’s policy support is still on the real economy, especially in the fields of large, small and micro enterprises, private enterprises, manufacturing and green, so as to stimulate the vitality of micro subjects. ” Zhou Maohua, financial market analyst, said.
Shen Xinfeng pointed out, “In the first quarter, the central bank will still use the precious window to cut reserve requirements or even cut interest rates again. However, it also needs to be clarified that under the tide of global liquidity tightening, the probability we see is only a short-term easing. In fact, after the outbreak in 2020, our monetary policy easing is not as strong as before in terms of time and range. The central bank will cherish the space for monetary normalization as a whole. ”
