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降息促投资之末,曲线陡峭化之始
Huajin Securities·2024-07-22 14:30

Group 1 - The report highlights the recent monetary policy adjustments by the People's Bank of China (PBOC), including a 10 basis points (BP) reduction in the 7-day reverse repo rate to 1.7%, and corresponding reductions in the 1-year and 5-year Loan Prime Rates (LPR) to 3.35% and 3.85% respectively, marking a significant shift in policy approach [1][1][1] - The adjustments aim to optimize the open market operation mechanism and enhance the transmission of monetary policy, reflecting the directives from the recent Third Plenary Session of the 20th Central Committee [1][1][1] - The report indicates that the PBOC is moving towards a more neutral counter-cyclical transmission mechanism, with a focus on steepening the yield curve while addressing the declining credit demand [1][1][1] Group 2 - The report notes that the PBOC's decision to maintain the Medium-term Lending Facility (MLF) rate unchanged while lowering the reverse repo and LPR rates is intended to strengthen the policy rate's attributes and reduce market expectations for unilateral long-term rate cuts [1][1][1] - The introduction of a framework allowing MLF participants to apply for a reduction in collateral requirements aims to increase the supply of long-term government bonds, which is expected to support the steepening of the yield curve [1][1][1] - The report suggests that the current monetary easing measures are more of a passive response to the slowing growth in Q2 rather than a proactive stimulus for high investment growth, indicating a shift in the PBOC's strategy [1][1][1]