MNI China Liquidity Index™ – Falls To 26.2 In March

Key Points – March Report

Liquidity eased in March, as the People’s Bank of China was perceived maintaining an ‘ample’ supply of cash, the latest MNI Liquidity Conditions Index shows.

The Liquidity Condition Index stood at 26.2 in March, down from the 31.6 recorded in February. The higher the index reading, the tighter liquidity appears to survey participants.

• The Economy Condition Index remains at elevated levels as the economy recovers, picking up modestly even on the February reading.
• The PBOC Policy Bias Index edged lower, although 80% of respondents saw no change in the PBOC’s bias. 
• The Guidance Clarity Index was little changed, with no respondents seeing the central bank as giving foggier indications of its intentions and the majority seeing no change in guidance opacity.

The MNI survey collected the opinions of 21 traders with financial institutions operating in China's interbank market, the country's main platform for trading fixed-income and currency instruments, and the main funding source for financial institutions. Interviews were conducted March 15 – March 26.