Central Bank: First look at two important interest rates

On the 12th, Sun Guofeng, director of the Monetary Policy Department of the People's Bank of China, said that more than a dozen foreign central banks have cut interest rates recently, and the Fed has also released a signal that it is possible to cut interest rates. I think we should look at China's interest rate level. Two very important interest rates.

At the press conference of the financial statistics of the People's Bank of China in the first half of 2019, a reporter asked: Recently, the probability of interest rate cuts in the United States will increase, and global monetary policy will enter a rate cut cycle. Now the domestic and international markets are expecting interest rate cuts in China to heat up. May I ask China? Is it not going to enter the interest rate cut cycle with other economies around the world?

Sun Guofeng said that we are concerned that more than a dozen foreign central banks have cut interest rates recently, and the Fed has also released a signal that it is possible to cut interest rates. The market has also expected this. The European Central Bank also hinted at cutting interest rates. In this context, your concern. It is also a good focus. I think how to observe China's interest rate level depends on our two very important interest rates. One is the overall market interest rate level. Our overall market interest rate has been declining since last year. The representative money market interest rate DR007 was 2.56% at the end of June 2019, down 45 basis points year-on-year. Another important indicator is the yield of 10-year Treasury bonds, which was 3.23% at the end of June 2019, down 25 basis points year-on-year. Another important type of interest rate is the actual interest rate of the loan. In May of 2019, the corporate loan interest rate was 5.34%, which is an average level, down 17 basis points year-on-year. In particular, the loan interest rates of small and micro enterprises have been significantly reduced. So we have two types of interest rates in China. One is the overall market interest rate, and the other is the loan interest rate. We have been lowering since last year.

What do you think about the next step? Sun Guofeng believes that the next phase of the People's Bank of China will continue to implement a prudent monetary policy, closely monitor changes in the domestic and international economic and financial situation, and under the premise of balancing the balance between internal and external balances, we must adhere to the principle of focusing on China, with a focus on China. The economic growth and price changes will be adjusted in a timely manner, comprehensively utilizing a variety of monetary policy combination tools, maintaining a reasonable liquidity and reasonable and stable market interest rates, and promoting measures to deepen interest rate marketization and dredge monetary policy to lending rates. The transmission promotes the reduction of the actual interest rate of corporate financing.