Central Banks
China’s Central Bank Tries to Catch Markets Off Guard With Surprise Easing
- Pan’s unexpected measures include mortgage rate and RRR cuts
- Investors say more may be needed to spur meaningful rebound
The People's Bank of China building in Beijing.
Source: Bloomberg
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Constrained on all sides, China’s central bank is aiming to squeeze more value out of its policy actions by catching markets unaware with surprise easing aimed at putting a floor under the struggling economy.
A record cut to a key lending rate earlier this week announced by the People’s Bank of China was just the latest unexpected move since Governor Pan Gongsheng took office last summer. At a press briefing last month, he shocked with an outsized cut to banks’ reserve requirement ratio.