Wang Qing, chief Macro Analyst of Dongfang Jincheng, also said that the LPR quotation has remained unchanged for six consecutive months. The fundamental reason lies in the effective control of the domestic epidemic situation, the V-shaped reversal of the macro-economy, the total easing represented by the reduction of interest rates and the reduction of reserve requirements, and the monetary policy emphasizes the balance between stable growth and risk prevention.
In addition, as far as the market is concerned, the liquidity tension in the inter-bank market recently also makes the quotation banks lack the motivation to compress LPR quotations. In order to crack down on financial arbitrage and prevent flooding, the short-term market interest rate represented by dr007 (inter-bank 7-day pledge repo rate) and the medium-term market fund interest rate represented by interbank deposit receipt issuance rate have continued to rise in recent years. At present, the process of tight currency inevitably leads to the corresponding increase of the average marginal capital cost of banks, which restricts the quotation banks to reduce the LPR quotation points. Wang said.
Wen bin also said that in the next stage, the increase of fiscal expenditure will improve liquidity, and the interest rate of interbank certificates of deposit will remain stable. At the same time, the pressure drop of structural deposits will also help to reduce the cost of bank liabilities, help to push down the real loan interest rate, further increase support for the real economy, and realize the goal of the financial sector making profits to the real economy.
At the same time, in order to ease the tight liquidity in the inter-bank market, the central bank has frequently invested funds through open market operation recently. Since the first reverse repurchase operation of this month on October 15, the central bank has carried out reverse repurchase operation for four consecutive working days, with a total operation scale of 220 billion yuan, of which, the operation scale on October 20 was 70 billion yuan.
However, there is still a convergence of funds on that day. Data on October 20 showed that Shibor (Shanghai interbank offered rate) rose across the board. The results showed that there was an upward trend of 17 BP to 2.187%, 3.1bp to 2.23% and 0.2bp to 2.634% in one month. In the future, Wen Bin said that the central bank will continue to strengthen the operation of the open market and adopt the policy tool combination of reverse repurchase + MLF, so as to maintain the reasonable and sufficient market liquidity and the overall stability of the market interest rate, and the probability of reducing the reserve rate and interest rate by the end of the year. Wang Qing said that with the end of the year approaching, the issuing interest rate of inter-bank certificates of deposit is expected to change from up to down, tight currency process will come to an end, and the average marginal capital cost of banks will turn to marginal downward. Even if the MLF operating interest rate remains unchanged before the end of the year, banks may also slightly reduce the LPR quotation plus point, changing the situation that the difference between MLF interest rate and one-year LPR quotation point has been fixed at 90 basis points since September last year, thus triggering a slight downward trend of one-year LPR quotation. Source of this article: Yang Bin, editor in charge of the first finance and Economics_ NF4368
In the future, Wen Bin said that the central bank will continue to strengthen the operation of the open market and adopt the policy tool combination of reverse repurchase + MLF, so as to maintain the reasonable and sufficient market liquidity and the overall stability of the market interest rate, and the probability of reducing the reserve rate and interest rate by the end of the year.