Reuters reports, citing policy sources close to the PBOC
- PBOC to ramp up policy easing
- But debt worries mean that it won't follow the Fed into steep rate cuts and QE
- PBOC will boost credit, lower funding costs especially for small firms
- PBOC will largely rely on mix of liquidity tools, such as RRR and lending facilities
I would say that is not too surprising considering China's predicament and so far, their constant and massive amounts of liquidity injection have helped somewhat. But yes, corporate debt and the property market will pose challenges if they deviate from this.
The policy sources cited also say that "fiscal policy will play the main role (in supporting the economy), and monetary policy will actively cooperate with fiscal policy".
