ICYMI, comments from Zou Lan, head of the People’s Bank of China’s (PBOC) monetary policy department in an interview with state media outlet Xinhua News Agency on Tuesday:

  • said that the PBOC may use open market operations, medium-term lending facilities and reserve requirements among other monetary policy tools to provide “strong" support for reasonable growth in credit
  • PBOC will also strengthen its counter-cyclical and cross-cycle policy adjustments to create favorable financial conditions for the country’s economic growth
  • PBOC will also take measures to prevent funds from clogging and idling while guiding financial institutions to strengthen their liquidity risk management for stable money market operations

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Rumours of further easing to come from the People's Bank of China never goes away. The Bank is in a bit of a conundrum though:

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Still to come soon:

*** USD/CNH update (offshore yuan):

usdcnh update pboc easing 10 January 2024