PBOC: We’re not stimulating

From MNI via Forexlive:

Ma Jun, chief economist of the research bureau under the PBOC:

• Says recent PBOC deposit reserve and interest rate cuts were not meant to create a strong stimulus effect
• Simply to maintain a neutral monetary policy position
• Said capital inflows no longer providing funds for the Chinese economy, liquidity could be tightened if the PBOC didn’t cut deposit reserves or use other policy tools
• Rate cuts were also aimed at keeping real interest rates stable due to falling producer prices
• Says the government could adjust economic policy again should downside pressure on the economy become worse than expected

And the proof:

These are China’s interbank repo rates. The short end has been thumped by the recent easing but longer terms remain very high relative to history. It remains a glide slope to lower growth not a new boom cycle.