Central bank’s ‘tremendous room’ to adjust policy may be put to test as China’s economy slows

The boast by People’s Bank of China governor Yi Gang this month that he has “tremendous room” to adjust policy could soon be tested as the economy slows, throwing attention on the impact on the nation’s fragile currency and financial markets.Compared to European and Japanese peers, China does have more obvious policy space. Its benchmark one-year lending rate has stayed at 4.35 per cent since 2015, far above zero. The Federal Reserve’s dovish turn also eases the depreciation pressures on the… Source link

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China has ‘tremendous’ policy room if US trade war worsens, central bank governor says

China has “tremendous” room to adjust monetary policy if the trade war with the United States deepens, People’s Bank of China Governor Yi Gang said.“We have plenty of room in interest rates, we have plenty of room in required reserve ratio rate, and also for the fiscal, monetary policy toolkit, I think the room for adjustment is tremendous,” said Yi in Beijing.Asked if his scheduled bilateral meeting with US Treasury Secretary Steven Mnuchin on the sidelines of the Group of 20 gathering of… Source link

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