China Merchants Securities Liquidity Monthly reported that the liquidity gap in September was limited. The natural maturity pressure in September is general, the impact of local debt payment is limited, the impact of financial funds is positive, the expected liquidity gap is about 300 billion yuan, the overall scale is limited. The maturity of interbank certificates of deposit will be concentrated in the latter half of the year, during which the investment of financial funds may be restrained.
It is noteworthy that on August 26, the central banks first MLF operation under the new LPR mechanism, the interest rate remained unchanged at 3.3%. As a result, the market generally locked in the expectation of a reduction in MLF operating interest rates in September. The central bank announced on the evening of September 6 that it decided to reduce the reserve requirement ratio of financial institutions by 0.5 percentage points (excluding financial companies, financial leasing companies and auto financing companies) on September 16 this year. In addition, in order to promote greater support for small and private enterprises, an additional 1 percentage point reduction in the deposit reserve ratio for urban commercial banks operating only in provincial administrative areas was implemented twice on October 15 and November 15, with each 0.5 percentage point reduction.
Under the dual background of the new LPR mechanism and the lowering of the standard, the follow-up price operation of MLF has attracted much attention from the market.
Lian Ping, chief economist of Bank of Communications, said that in order to promote the decline of real interest rates, the new LPR quotation mechanism focused on the MLF operating interest rate, so it put forward requirements for the MLF operating interest rate reduction. However, judging from the short-term interest rate difference between MLF and SHIBOR, it is a prerequisite to increase liquidity to depress the interest rate of money market funds in order to open up the space for the reduction of MLF operating interest rate in the future. It can be seen that the reduction is also to lay the foundation and create conditions for the future reduction of MLF operating interest rates.
Pan Xiangdong, chief economist of New Age Securities, believes that in order to further reduce the real interest rate of loans, the central bank may continue to reduce the MLF interest rate during the year, leading more funds to the real economy, especially small and micro enterprises. In order to avoid the return of funds to real estate, strengthening credit control in the real estate sector is still the bottom line of future monetary policy.
Although the industry expects that MLF will have room for adjustment during the year, some experts believe that the MLF interest rate will not be lowered in the short term. Jiang Chao team of Haitong Securities said in the research report that there is a view in the market that interest rates will be cut after the reduction. Even if the central bank does not lower the benchmark interest rates for deposits and loans, it is possible to lower the winning rate in the open market. Especially after the LPR reform, because it is linked to the MLF interest rate, many people predict that the central bank will also reduce the MLF operating interest rate later. However, if the central bank maintains a sound monetary policy orientation and withdraws all the reduced funds through MLF, this means that there may be no MLF operation in the next three months, which means that the short-term fall in MLF interest rates is actually a probability event.
Source: Liable Editor of Securities Daily: Yang Qian_NF4425