PBOC Lowers 14-Day Reverse Repo Interest Rate by 10 Basis Points

  • China’s central bank lowers short-term policy rate
  • 14-day reverse repurchase interest rate cut by 10 basis points to 1.85%
  • Injected 74.5 billion yuan ($10.6 billion) of liquidity into the financial system
  • Efforts to boost the economy
  • No change in 7-day reverse repo rate at 1.7%
  • PBOC may lower 7-day reverse repo rate in coming months

The People’s Bank of China (PBOC) has cut a short-term policy rate and injected liquidity into the financial system to boost the economy. The central bank lowered the 14-day reverse repurchase interest rate by 10 basis points to 1.85% and infused 74.5 billion yuan ($10.6 billion) via a policy tool, according to its website. This move follows the reduction in the 7-day reverse repo rate in July when PBOC didn’t conduct a 14-day reverse repo operation. Economists predict that the Chinese central bank may lower the 7-day reverse repo rate – considered the key rate for benchmark lending rates – in the coming months, as the Fed’s cut provides more room for monetary policy easing.

Factuality Level: 8
Factuality Justification: The article provides accurate and objective information about China’s central bank actions and economists’ expectations regarding future rate changes. It includes relevant details about the recent interest rate adjustments and the reasoning behind them, without any digressions or personal opinions.
Noise Level: 3
Noise Justification: The article provides relevant information about China’s central bank actions and economic measures, but lacks in-depth analysis or actionable insights.
Public Companies: People’s Bank of China ()
Key People: Zhiwei Zhang (Economist at Pinpoint Asset Management)

Financial Relevance: Yes
Financial Markets Impacted: Chinese financial markets and global markets potentially impacted by central bank’s actions
Financial Rating Justification: The article discusses the People’s Bank of China’s monetary policy decisions, which can have significant effects on interest rates and liquidity in the Chinese financial system. These decisions can influence not only domestic markets but also global markets as they are connected to the U.S. Federal Reserve’s rate cut.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: No extreme event is mentioned in the text and it’s not the main topic.
Deal Size: 10600000000
Move Size: 10 basis points
Sector: All
Direction: Up
Magnitude: Large
Affected Instruments: Stocks, Bonds

Reported publicly: www.wsj.com