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China interbank liquidity eased modestly in November, retreating from October’s nine-month high, as the central bank injected funds to deal with liquidity pressure.
Meanwhile the economic outlook amongst market participants remained uncertain, with October's data showing retail sales improving but investment remaining weak highlighting the patchy recovery, the latest MNI Liquidity Conditions Index survey showed.
- The MNI China Liquidity Condition Index eased to 56.4 from October’s 62.8, with a third of traders reporting tighter liquidity.
- The MNI China Economy Condition Index dropped to 60.3 from October’s seven month high of 69.2, with 20% noting worsening economic conditions, up from 18% previously.
- The MNI China PBOC Policy Bias Index reached 35.9 with 72% of local traders expecting the PBOC to maintain a prudent monetary policy, and 28.2% of traders 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 November 13 – November 24.
