Key Points – February Report
Liquidity eased in February, as the People’s Bank of China was perceived maintaining an ‘ample’ supply of cash in the latter part of the month, the latest MNI Liquidity Conditions Index shows.
The Liquidity Condition Index stood at 31.6 in February, down from the 47.4 recorded in January. 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 shy of the year high seen in September.
- The PBOC Policy Bias Index edged lower, although 90% of respondents saw no change in the PBOC’s bias.
- The Guidance Clarity Index rose, 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 19 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 Feb 1 – Feb 19
