- Cuts 1 year lending rates by 0.4
- Cuts 1 year deposit rates by 0.25 to 2.75%
- Rate cut effective from 22 Nov
AUD, Kiwi and CAD benefitting off the bat.
Not wholly unexpected by markets but the confirmation has been enough to kick commodity currencies higher.
Further details now from the PBOC
- Raises deposit ceiling to 1.2 times of benchmark from 1.1 times
- Says it’s giving banks more freedom to set deposit rates
- Says it advances interest rate reforms
They last cut rates in July 2012 and while they are waffling on about giving freedom to banks it’s mainly to help bolster the economy and stem any slowdown. That’s going to be difficult in itself with the global picture not it’s brightest. As you can expect, commodities have been given a kick higher on the news.
