PBOC doves amid the Western hawks

The People’s Bank of China (PBOC) announced a surprise five basis points (bps) cut to the benchmark one-year Loan Prime Rate (LPR) to 3.80% this morning, while keeping the five-year rate intact around 4.65%:


This puts it into stark contrast with Western central banks with the Fed ready to unleash up to six rate hikes in 2022, the ECB tightening its overall policy last week while the BOE actually raised rates:

The Aussie dollar dropped on the news, heading back to the 71 handle:

While the Yuan continues to weaken against USD after the PBOC also substantially eased the fixed rate today, hiking the reference rate to 6.3933 with offshore trading now pushing towards the 6.40 level:

Latest posts by Chris Becker (see all)


  1. Hugh PavletichMEMBER

    China’s bursting housing bubble …

    China’s property distress sours steel sector in warning sign for economy … Reuters


    China urges real estate project acquisitions to aid struggling developers -state media … Reuters


    Chinese Estates Plunges by Record After Privatization Collapses … Bloomberg


    Crisis continues for China’s real estate developer Evergrande … Al Jazeera / Youtube