.jpg)
Key Points – September Report
China’s interbank market liquidity tightened in September, as the PBOC preserved sufficient liquidity to support the economy going into Q4, with cuts made to the reserve requirement ratio (RRR) and adjustments to its daily open market operations.
Traders' views on the economy rebounded strongly, ending a 5-month run of declines, as participants saw encouragement from higher production and consumption statistics, the latest MNI Liquidity Conditions Index showed.
- The MNI China Liquidity Condition Index climbed to 52.6 in September from August’s 44.9, with 25.6% of traders reporting tighter conditions towards the end of Q3.
- The MNI China Economy Condition Index jumped to 55.1 in September, up from 25.6 previous -- the highest reading in five months.
- The MNI China PBOC Policy Bias Index stood at 35.9, with 71% of traders expecting the PBOC will maintain prudent monetary policy, and 28% anticipating further easing.
The MNI survey collected the opinions of 39 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 from September 11 – September 22.
