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China CUTS Interest Rate
In a stark policy divergence with other major economies, the People's Bank of China lowered the rate at which it provides one-year loans to banks by 10 basis points -- the first reduction since April 2020.
The rate cut is part of Beijing's efforts to put a floor under growth in a crucial year of leadership transition for the world's second-largest economy. The biggest challenges to meeting that goal are sporadic outbreaks of the more-infectious omicron coronavirus variant, and continued falls in property sales reducing housing investment.
Economists expect more policy action from the PBOC in coming months. Goldman Sachs Group Inc. said there's a possibility the central bank will allow banks to lower the five-year loan prime rate, a reference for mortgages, on Thursday.
The rate cut is part of Beijing's efforts to put a floor under growth in a crucial year of leadership transition for the world's second-largest economy. The biggest challenges to meeting that goal are sporadic outbreaks of the more-infectious omicron coronavirus variant, and continued falls in property sales reducing housing investment.
Economists expect more policy action from the PBOC in coming months. Goldman Sachs Group Inc. said there's a possibility the central bank will allow banks to lower the five-year loan prime rate, a reference for mortgages, on Thursday.
https://www.bloomberg.com/news/articles/2022-01-17/china-s-economic-growth-slowed-prompting-interest-rate-cut
