According to industry insiders, although the previous interest rate cuts and RRR interest rate cuts have limited effect on reducing long-term financing costs, it is still necessary to continue monetary easing, and it is expected that the space may narrow. Stimulating further economic recovery in the future can not only rely on monetary policy, but also need more fiscal and industrial policies to escort.
The initial very strong and clear expectations for interest rate cuts and RRR cuts have recently become somewhat vague. Many people are wondering whether the central bank's monetary policy should be adjusted. The whole market is caught in a continuous wait-and-see atmosphere.
On June 23, the central bank's open market operation reappeared, which was the ninth consecutive time that the central bank suspended reverse repurchase in the open market. In addition to suspending reverse repurchase, not long ago, the central bank also directly repurchased some institutions for 7 days, 14 days and 28 days, with a total operation volume exceeding 100 billion yuan. Positive repurchase actually means the liquidity of the central bank in the "recycling" market.
According to media reports, the central bank at least did not fully renew the MLF (medium-term loan facility) of about 670 billion yuan due last week. MLF is a monetary policy tool for the central bank to provide medium-term base money. Failure to do this means that the central bank has not further relaxed the liquidity of the interbank market. In fact, recently, under multiple pressures such as the issuance of new shares and the assessment of commercial banks at the end of the first half of the year, the liquidity between banks is slightly tense. As of last Friday, the repo rate in the inter-bank market rose as a whole compared with the previous week, among which the 2 1 day rate rose most obviously, with the upward range reaching 126 basis points, and the upward range of other maturity varieties ranged from 16 basis points to 74 basis points. However, at this time, the central bank did not choose to complete the sequel of MLF at a lower interest rate, which also triggered speculation about whether the central bank is tightening liquidity in disguise.
There are more than these reasons for the fine-tuning of market expectations. According to the latest data released by the central bank, the foreign exchange holdings of financial institutions increased by 32.2 billion yuan in May, which was the second consecutive month of positive growth. Looking back on past data, in June and April this year, the newly-increased foreign exchange holdings of financial institutions were-108.2 billion yuan, 4221400 million yuan,-1564.76 billion yuan and 32.396 billion yuan respectively. The sustained positive growth of foreign exchange holdings has also eased the market's concerns about the liquidity gap caused by it, and the motivation to further release liquidity seems to be weakening.
In fact, most analysts believe that it is not the initiative of the central bank, whether it is directed repurchase operation or not to continue MLF, but that commercial banks are unwilling to hold more liquidity from their own perspective. However, this also shows that the market itself is not short of liquidity. If the central bank continues to inject liquidity, these liquidity may fail or fail to form an effective credit supply.
"Monetary policy is actually a total policy. The central bank cannot control the flow of funds, and funds are profit-seeking. They may enter high-risk and high-yield fields after several rounds, rather than the policy originally hoped to guide them into the real economy. Under this circumstance, the central bank may also wait and see whether it is necessary to increase the easing of monetary policy. " A person from a commercial bank told the reporter of Economic Information Daily (Weibo).
The previous interest rate cuts and RRR cuts seem to have limited effects, so will monetary policy continue to be loose? Many people in the industry have given a positive answer that it is necessary to continue to loosen the currency, but the space may be narrowed.
Wen Bin, chief researcher of Minsheng Bank, told the Economic Information Daily that since the beginning of the year, the effect of a series of steady growth policies issued by the government has been obvious. In May, PMI continued to rise, and it has been higher than 50 for three consecutive months. At the same time, the real estate prices in 100 cities also turned from negative to positive, the transaction volume was enlarged, and the property market stabilized. With the approval of infrastructure investment projects, the role of infrastructure investment in steady growth will be further enhanced. However, the year-on-year growth rate of CPI in May dropped from last month, and the year-on-year growth rate of PPI continued to be negative, reflecting that the growth momentum in the economic transformation stage is still insufficient. There is still room for monetary policy to relax.
He also said that after two "comprehensive and targeted" RRR cuts, the liquidity of the financial system was loose and the excess reserves of commercial banks increased; The trade surplus expanded to nearly $60 billion in May, and the increase in foreign exchange holdings will reduce the urgency of reducing RRR holdings and squeeze the space for further reduction of RRR holdings. However, in the long run, with the Federal Reserve raising interest rates at the end of the third quarter or the beginning of the fourth quarter of this year, and China further opening its capital account, the pressure of net outflow of domestic funds may be even greater, which means that RRR is still needed to cut interest rates to further release liquidity.
In the short term, the issuance of local bonds also needs the escort of funds. According to a report released by China Securities, monetary policy is still in a relaxation cycle. At present, the second batch of replacement bonds has been issued, and the third batch of replacement bonds may be in the pipeline. After all, the current two batches of 1 trillion replacement bonds are only based on the audit caliber of 20 13 at the end of June. Microscopically, the growth rate of debt from the end of June 20 13 to the end of June 20 14 was significantly higher than before, and the debt repayment pressure of this part was obviously greater. Before the end of local debt replacement, the central bank will give monetary policy cooperation and keep the interest rate of funds loose.
However, many market participants also said that in addition to the aggregate policy, the future monetary policy will increase the intensity of directional relaxation. Previously, the central bank officially confirmed that after four operations in September 20 14, June 20 10 and March 20 15, the PSL interest rate was lowered from 4.50% to the current 3. 10%. In the future, PSL and newly created monetary policy tools will become the policy toolbox of the central bank.
In fact, monetary policy is not omnipotent. As Sheng Songcheng, director of the Survey and Statistics Department of the Central Bank, said at a forum, monetary policy is very useful for stabilizing the economy and curbing inflation when the economy is overheated, but it is very difficult to stimulate the economy when the economy is depressed.
"interest rate cuts and RRR cuts can bottom out the economy in the short term, but in the long run, monetary policy alone cannot continue to promote economic growth. In the process of economic transformation, it is still a long-term process to find new economic growth points. " Wen Bin said that fiscal policy and related industrial policies will play a more important role in the process of steady growth.