January 25, 2024 02:07 GMT
MNI China Press Digest Jan 25:RRR Cut, Real Estate, Birth Rate
MNI (Singapore)
MNI (Beijing)
MNI picks keys stories from today's China press
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Highlights from Chinese press reports on Thursday:
- The People’s Bank of China’s greater-than-expected cut to the reserve requirement ratio by 50bp will help boost the economy, ease liquidity pressure before the Chinese New Year and stabilise the capital market, 21st Century Business Herald reported citing analysts. While the cut is expected to release CNY1 trillion of long-term funds, some institutions estimate the liquidity gap may exceed CNY2 trillion before the holiday, as the order of social life has returned to the pre-pandemic level. After the cut, the benchmark Loan Prime Rate is also expected to be lowered in February, alongside the reductions in banks’ deposit interest rates since last December.
- Local authorities are lowering first-home loan interest rates or even removing their lower limit, with 60 out of 100 major cities seeing rates at the 3% level, Shanghai Securities News reported. A total of nine cities saw first-home loan interest rates fall in January by 5-30bp, mainly in second-, third- and fourth-tier cities, of which the average rate fell to 3.86% and 3.82%. The average first-tier city rate remains unchanged at 4.13% from the previous month. More cities will gradually follow suit to lower the rate of first home, and new regulations have stipulated that there is no need to set a lower limit on interest rates should the home price index fall for three consecutive months.
- Authorities should implement policy reforms to boost birth rates such as providing financial subsidies to lower nursery fees and allowing foreign nannies to work in China, according to Liang Jianzhang, co-founder at Ctrip Group and a population economist. China lagged behind northern European countries who spend 2-3% of GDP per year on child subsidies, Liang noted. On the silver economy, the post-60s generation will be the first retirees who benefited from the reform and opening up era, and will therefore drive increased consumption growth. (Source: Yicai)
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