Iron ore booms as China stimulates everything but property

We’re saved! At least the iron ore futures market thinks so with its best rally in a few months underway. Goldman:

The State Council released a document on stepping up support to SMEs. While the measures discussed in the document are not really new, it is a comprehensive list of policy measures involving more fiscal support to SMEs’ daily operations; financial support to SME borrowings and administrative support to SME employment. The State Council also required various government institutions to report progress in a timely manner. The previous key policy announcement from the State Council on stepping up support to SMEs was in early September when the additional RMB 300bn SME relending quota was announced. Specific measures in this document include:

  • Encouraging local governments to set up funds and subsidize SMEs on their administrative fees, and further implement tax reduction for SMEs.
  • Stepping up working capital financing support to SMEs especially for those affected by virus out break, floods and elevated commodity prices.
  • Ensuring power supply to SMEs especially those key to the whole supply chain and further lowering power fees for SMEs.
  • Encouraging SMEs to maintain stable employment.
  • Stepping up investment in new infrastructure and people’s livelihood and increasing procurement from SMEs.
  • Asking various government institutions including PBOC, MoF, NDRC, CBIRC,MIIT to report progress in a timely manner.

The PBoC swung into action:

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