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PBOC's Zou Lan: Still Room for RRR/ Interest Rate Cuts This Yr
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Zou Lan, spokesperson and deputy governor of the People's Bank of China (PBOC), stated at a press conference held by the State Council Information Office that there is still room for reserve requirement ratio (RRR) cut and interest rate cut this year. Regarding the statutory deposit reserve ratio, the current average statutory deposit reserve ratio for financial institutions is 6.3%, indicating there is still room for RRR cuts. In terms of policy rates, from the perspective of external constraints, the RMB exchange rate is relatively stable, and the USD is in a rate-cutting cycle, so the exchange rate does not pose a strong constraint. From the perspective of internal constraints, since 2025, the net interest margin (NIM) of banks has shown signs of stabilization, and in 2026, there will be a significant amount of three-year and five-year long-term deposits maturing. The recent reduction in rates for various structural monetary policy tools will help reduce banks' interest payment costs and stabilize NIMs, creating some room for interest rate cuts. AASTOCKS Financial News Website: www.aastocks.com |
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