Key Points – January Report
Liquidity tightened in early January, before loosening as the People’s Bank of China maintained 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 47.4 in January, up from the 15.9 recorded in December. 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 80% 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 vast 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 institution
