Sino-Singapore Jingwei Client, September 21, reported that the loan market quoted interest rate (LPR) in September has not been adjusted.

So far, LPR has been "standstill" for five consecutive months.

Not adjusted for five consecutive months

  On the 21st, the People's Bank of China authorized the National Interbank Funding Center to announce the loan market quote rate (LPR), showing that the one-year LPR is 3.85%; the five-year-old LPR is 4.65%, which remains unchanged from the August quotation.

  Screenshot of the central bank website

  Wind data shows that last week (September 14 to 18) the central bank conducted a total of 480 billion yuan of reverse repurchase and 600 billion yuan of MLF operations in the open market, due to the 620 billion yuan reverse repurchase and 200 billion yuan of medium-term borrowing facilities last week (MLF) and 50 billion yuan of treasury cash deposits are due, so last week the central bank's open market full-caliber net investment of 210 billion yuan.

  Since the LPR quotation is linked to the MLF interest rate, the market pays attention to the central bank’s MLF operating interest rate while also including the prediction of the LPR quotation.

  On September 15, the central bank issued an announcement that in order to maintain a reasonable and sufficient liquidity in the banking system, it carried out 600 billion yuan of medium-term loan facility (MLF) operations on the same day (including the renewal of the MLF expiration on September 17), which fully satisfied financial institutions. demand.

The winning bid rate for this MLF operation is 2.95%, the same as the previous operation.

  The MLF interest rate remained unchanged, and the market had generally believed that the adjustment of the LPR in September may again fail.

According to Wang Yifeng, chief analyst of the financial industry of Everbright Securities, the central bank maintained the MLF interest rate unchanged while continuing to overtake the MLF, which was basically in line with market expectations.

Although the interest rate of funds has risen recently, banks are still actively lowering the pricing of liabilities, and there is a high probability that LPR quotations in September will remain unchanged.

How will LPR go in the next three months?

  There are three months left before 2020. How will LPR change in these three months?

Is it possible to cut interest rates and RRR?

  The chief analyst of fixed income at CITIC Securities clearly believes that since this year, the liquidity injection method of monetary policy has shifted from RRR cut to reverse repurchase. Starting in the second quarter, the central bank's liquidity injection has changed to lock-in and short-term, and MLF shrinkage continues to become the norm.

However, in August, the pressure on the bank's debt side gradually emerged. Under the dual pressure of government bond issuance, slower pace of fiscal expenditure, and pressure drop in structural deposits, banks exposed the pressure of shortage of deposits, the excess reserve rate fell, and the interest rate of inter-bank deposits was rapid. rising.

Therefore, the central bank has renewed the excess MLF from August, and in September further increased the net investment scale on the basis of August to ease the pressure on banks' liabilities.

  Hue, chief economist of Founder Securities, said that the MLF operation on September 15 showed that in the context of normalized monetary policy, to ease long-term liquidity tensions, the central bank’s main method is to continue doing MLF in excess, and with the regularization and Reverse repurchase is the main form of short-term liquidity adjustment.

He further stated that with the continuous improvement of my country's economic fundamentals, there is basically no possibility of a RRR cut before the end of the year.

  How will LPR go?

Wang Qing, chief macro analyst at Oriental Jincheng, believes that according to the announcement of the central bank, the conversion of stock floating-rate loan pricing benchmarks should be completed before August 31, 2020. In the future, the sensitivity of bank net interest margins to LPR quotations will further increase, and LPR will be lowered. Quotations tend to be cautious.

  On August 25, Sun Guofeng, Director of the Monetary Policy Department of the Central Bank, pointed out at the State Council’s regular policy briefing that the future trend of LPR depends on factors such as macroeconomic trends, inflation, and supply and demand in the loan market, depending on the marketization of the quotation bank. Offer.

With the further release of the potential of the LPR reform to promote lower loan interest rates, it is expected that subsequent corporate loan interest rates will fall further.

(Zhongxin Jingwei APP)