Comments now from the PBOC Gov: Stock market valuations at low level

Author: Eamonn Sheridan | Category: Central Banks

People's Bank of China now seeking to stick a floor under Chinese stock markets

PBOC Governor Yi Gang
  • recent stock market fluctuations largely due to investor sentiment, expectatons
  • China's economic fundamentals are good, macro leverage levels stabilising
  • Current stock market valuations are at a relatively low level
  • stock market valuations not in line with china's economic fundamentals
  • central bank studying targeted measures to help financing problems of companies
  • will push forward plans to support private firms' bonds financing
  • Will use monetary policy tools including MLF to boost lending to private firms
(MLF is the medium term lending facility which is normally money lent to banks) 

This is a concerted effort, be surprising if there isn't a pop in China stocks.

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