PBOC Unlikely To Cut Rates In H2-Economist

The People’s Bank of China is unlikely to cut interest rates in the second half of the year amid the tightening of the global financial environment and rising domestic inflation, though a small cut to the reserve requirement ratio in Q4 cannot be ruled out, wrote Wen Bin, chief economist of Minsheng Bank in an article published by 21st Century Business Herald. The central bank will focus on guiding banks to increase lending, while maintaining ample liquidity and driving down the actual loan interest rate, said Wen. There is still room for the Loan Prime Rate to decrease, especially the five-year maturity, if consumption and investment are weaker than expected, said Wen.