Zhong Guo Jing Ying Bao·2025-04-10 05:57Core Viewpoint - Several banks have recently lowered deposit rates in response to external shocks and to stimulate domestic demand, with expectations for further reductions in the future [1][3][4]. Group 1: Deposit Rate Adjustments - Banks in regions such as Guangxi, Xinjiang, Guangdong, and Hubei have reduced rates on various deposit products, with the highest reduction reaching 40 basis points (BP) [1][2]. - Specific adjustments include Guangxi Xilin Rural Commercial Bank lowering its 2-year, 3-year, and 5-year fixed deposit rates by 25 BP, 45 BP, and 40 BP respectively, resulting in rates of 1.60%, 1.90%, and 1.95% [2]. - Other banks, such as Guangdong Nanao Rural Commercial Bank, have also made similar reductions, with the 1-year fixed deposit rate decreasing from 1.60% to 1.55% [2]. Group 2: Reasons for Rate Reductions - The primary reasons for the recent deposit rate cuts include the need to respond to external economic pressures and the expectation of monetary policy easing, such as reserve requirement ratio (RRR) cuts and interest rate reductions [3][4]. - Banks are adopting more flexible asset-liability management strategies to maintain net interest margins, which has led to a more refined approach to deposit pricing [3]. Group 3: Future Outlook - There is potential for further reductions in deposit rates, as the People's Bank of China has indicated a willingness to adjust rates based on economic conditions [4]. - The agricultural bank's vice president noted that the downward trend in deposit rates is expected to continue into 2025, influenced by factors such as the effectiveness of previous rate cuts and the overall decline in market interest rates [4][5]. - Different banks will implement more proactive and flexible deposit pricing strategies based on their market positions and asset-liability situations [5].