MNI China Liquidity Index™ – Picks Up To 78.1 In October

Key Points – October Report

Liquidity edged higher in October, as the People’s Bank of China maintained an ‘ample’ supply of liquidity, the latest MNI Liquidity Conditions Index shows.

The Liquidity Condition Index stood at 78.1 in October, up from the 75.0 recorded in September. The higher the index reading, the tighter liquidity appears to survey participants.

• The Economy Condition Index remains at elevated levels as the economy recovers, with all respondents seeing an improved or unchanged outlook.
• The PBOC Policy Bias Index was higher, with almost a third of respondents seeing a tightening bias from the central bank.
• The Guidance Clarity Index was barely changed, with no respondents seeing the central bank as giving foggier indications of its intentions – a theme in place from respondents since February.

The MNI survey collected the opinions of traders at 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 between Oct 12 and 23.