Economics
China Faces Contrarian Calls for a Surprise Interest Rate Cut
- Government-affiliated economists say PBOC should ease
- They see policy space after Beijing’s effort to curb debt
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China’s central bank is facing mounting calls to cut interest rates as fresh coronavirus outbreaks threaten to upend the recovery in the world’s second-largest economy.
Economists affiliated with the government see scope for lower interest rates, arguing that Beijing’s success in curbing debt growth means the central bank can ease policy without fueling financial risks. Their views contrast with global investment banks, who mostly see the People’s Bank of China keeping policy interest rates steady this year.