Securities Daily Review: RRR cuts are a panacea but can't cure all diseases

1comment 2019-04-15 08:13:01 source:Securities daily Author:岳 岳 Just do it next week! Steady!

Although the economic data in March has shown signs of warming, the market is still reluctant to give up the panacea, and experts from all walks of life have made predictions.Central bankIt will be lowered in April or June, and it will mean that this conjecture will continue if there is no RRR.

Reducing the need to both withstand downward pressure and not slow downUpgradeofChina's economyIn fact, it is a panacea. The continuous RRR cut since last year has enabled the Chinese economy to achieve steady development. Since the beginning of this year, the relevant departments have attached great importance to the downward pressure on the economy and launched a policy combination of economic burden reduction, which has enabled the international community to enhance its confidence in the Chinese economy.

InternationalMonetary FundThe latest issue of the World Economic Outlook Report released by the organization raised China’s economic growth forecast by 0.1 percentage points this year to 6.3%. Foreign Ministry spokesperson Lu Yi commented on this. "The International Monetary Fund raised China's economic growth expectations, indicating that the international community has firm confidence in the Chinese economy's sustained high-speed growth and the middle and high-end."

The financial data released last March was more optimistic. The use of structured monetary policy tools gave SMEs real financial support and allowed the central bank to take a breather in the choice of monetary policy. However, the market is still obsessively predicting the timing of the RRR reduction is not April or June.

They made this judgment on the basis that there is still a small liquidity gap in April and SMEs need to continue to provide financial support. However, as of April 12, the central bank has suspended the counterRepo17 trading days (third in history). Although the reason for the central bank to suspend reverse repurchase has changed from the previous “the current liquidity of the banking system is at a relatively high level” to “the current liquidity of the banking system is at a reasonable abundance level”, this is obviously subject to tax payment in April. And the impact of the upcoming 36.5 billion MLF is about to expire.

As for the judgment that the RRR is extended to June, it indicates that the market is optimistic about the economic data for the first quarter of this year, but due to the habitual concerns about the liquidity pressure at the mid-year point, it still gives higher expectations for the RRR cut. The economic data for the first quarter of this year will be on the rise.

At this year's press conference of the two sessions, the central bank governor Yi Gang introduced that the weighted average deposit reserve ratio of all financial institutions in China is about 11%, 12% in the US and Europe, and more than 20% in Japan.

For the strength of current monetary policy,bankerThe feelings should be more realistic. The central bank’s survey of bankers’ questionnaires in the first quarter of this year showed that the bank’s monetary policy perception index was 58.4% in the quarter, up 5.3 percentage points and 18.7 percentage points from the previous quarter and the same period last year. For the second quarter, the monetary policy experience expectation index was 61.4%, which was 3.0 percentage points higher than the first quarter. This means that bankers are also looking forward to the continued relaxation of monetary policy in the second quarter.

This expectation of bankers is not groundless. Last week, the State Council’s opinion on the implementation of the division of labor of the key work departments of the “Government Work Report” was officially released. The relevant work of the central bank included “flexible use of multiple monetary policy tools”, “timely use of deposit reserve ratio, interest rate, etc.” Price means... Increase the targeted reduction of small and medium-sized banks, and all the funds released will be used for private and small and micro enterprise loans." This clear job requirement also lifted the market's expectation of RRR cut.

However, what the author wants to emphasize here is whether the RRR reduction depends on the needs of the real economy. It is a panacea if it falls and falls without hesitation. However, the downward pressure on China's economy requires all aspects of cooperation, and it is obviously unrealistic to expect to reduce the number of cases.

Keyword reading:MLF Economic data Alignment

Editor in charge: Shen Xuejiao RF13056
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