China’s Easing Forces Traders to Rethink How They Label Markets
- Central bank cut reserve-requirement ratio to inject liquidity
- Traders, analysts weigh nation’s investment class post-virus
The first country to get hit by the pandemic has become the first global economy to stumble as the world begins to heal, pushing investors to reconsider where China fits on the old-fashioned continuum of emerging and developed markets.
The world’s second-largest economy chose its own distinct path to recovery on Friday, lowering its reserve-requirement ratio and effectively easing monetary policy amid worries about the pace of its economic rebound. The move is a stark divergence from what’s happening in other parts of the world, where policy makers from Mexico to Brazil to Hungary have increased their key interest rates to deal with accelerating inflation. Even the Federal Reserve has hinted at taking a more hawkish monetary stance as prices rise.