The question is, what will it achieve? Bloomie has a crack at it:
- More Chinese economists are calling for cash rate cuts as the economy slows.
- Xu Hongcai, deputy director of the economic policy committee at the state-run think tank China Association of Policy Science says real estate is contained so the PBoC can act.
- Tommy Xie, head of Greater China research at Oversea-Chinese Banking Corp says RRR cut are still working so PBoC should wait.
- Cao Heping, an economics professor at Peking University says investment will fit if the PBoC cuts.
I agree entirely that the PBoC is going to have to cut the cash rate, not just RRR cuts which do absolutely nothing. For all of the reasons cited above.
