MNI China Liquidity Index™ – Eases To 15.7 In December

Key Points – December Report

Liquidity was boosted in December, as the People’s Bank of China maintained an ‘ample’ supply of cash, the latest MNI Liquidity Conditions Index shows.

The Liquidity Condition Index stood at 15.7 in December, down from the 48.3 recorded in November. The higher the index reading, the tighter liquidity appears to survey participants.

• The Economy Condition Index remains at elevated levels as the economy recovers, although just shy of the year high seen in September.
• The PBOC Policy Bias Index edged lower, although three-quarters of respondents saw no change in the PBOC’s bias. from the central bank.
• The Guidance Clarity Index rose, with no respondents seeing the central bank as giving foggier indications of its intentions and the vast majority seeing no change in guidance opacity.

The MNI survey collected the opinions of traders at financial institutions operating in China's interbank market, the country's main platform for trading fixedincome and currency instruments, and the main funding source for financial institutions. Interviews were conducted between Dec 7 and 18.