PBOC's New Carbon Reduction Lending Not A Stimulus: Times

The PBOC's new lending tool introduced on Monday, which carries a below-market rate, was aimed at facilitating banks' lending to carbon-neutral transition and not a short-term credit stimulus, the Securities Times reported citing Zhang Xu, chief fixed-income analyst with Everbright Securities. The new tool will focus on supporting three key areas of clean energy, energy conservation, and emission-reduction technologies, with a one-year lending rate of 1.75%. Though the rate is lower than other structural tools like re-lending and rediscounting, Zhang noted it does not represent a change in the direction of monetary policy, the newspaper said. This structural tool is limited in scale and impact, the newspaper cited Zhang as saying.