A morning heads up from ING, nice summary (underlining is mine)
Covid cases continue to rise across much of the country, and mobility restrictions (lockdowns in all but name) are increasing. This is bound to have an impact on the fourth quarter GDP result, and as a result, could impact the outlook for 2023 GDP estimates which could be adversely affected by a year-end dip like this. Contemporaneous indicators for 4QGDP in China are looking quite bad right now.
And it is probably with this in mind that the State Council was reported by CCTV yesterday as looking to get the PBoC to implement another RRR cut “in a timely and appropriate manner”. That suggests quite soon – maybe in the next few days.
I posted on this earlier:
People's Bank of China Governor Yi Gang will respond to instructions from the State Council. He is leading a central bank that is very concerned about accelerating capital outflow as (almost) everywhere else jacks rates higher while the PBOC eases. But, yeah, what his bosses say he'll do. An RRR cut would be an acceptable option. Lower interest rates would not (but, again, if he is instructed to do so, he will).