Our reporter Yao Jin
Recently, the efforts of open market operations have increased.
On March 31, the People's Bank of China announced that in order to maintain stable liquidity at the end of the quarter, a reverse repurchase operation of 150 billion yuan was carried out by way of interest rate bidding on the same day, with a period of 7 days and the winning rate of 2.10%.
This is the fifth consecutive working day that the central bank has carried out a reverse repurchase operation of 100 billion yuan.
On March 25th, 28th, 29th, 30th and 31st, the central bank carried out 100 billion yuan, 150 billion yuan, 150 billion yuan, 150 billion yuan, and 150 billion yuan 7-day reverse repurchase respectively. 2.10% remains unchanged.
Industry insiders believe that such operations will help the market to be stable and abundant at the end of the month and quarter, and it is expected that funds will remain stable in April.
"Recently, the central bank has moderately increased the net investment of reverse repurchase, mainly because the market interest rate fluctuations have increased near the end of the month and the season At the same time, the recent external uncertainties have exacerbated global market volatility, and the central bank’s care of funds will also help ensure reasonable and sufficient liquidity and stabilize market sentiment.” said Zhou Maohua, a macro researcher at the Financial Market Department of China Everbright Bank.
Mingming, the co-chief economist of CITIC Securities, said that the central bank slightly overextended the medium-term lending facility (MLF) in March, and from the perspective of reverse repurchase, monetary policy still protects inter-bank liquidity.
In the last week of March, the funds were affected by factors such as tax payment, standard payment, and the end of the month, and the interest rate of funds across the quarter rose significantly. In this regard, the central bank increased the scale of reverse repurchase operations from March 25, 28 to 31. Demonstrate the determination to maintain the stability of funds.
From the perspective of capital, the current market liquidity is relatively abundant, and the capital interest rate has declined across the board.
On April 1, the Shanghai Interbank Offered Rate (Shibor) overnight fell 40.7 basis points to 1.6040%, 7-day varieties fell 18 basis points to 2.0170%, and 14-day varieties fell 39.20 basis points to 2.0000%; as of April At 11:00 on the 1st, the weighted average interest rate of DR007 (7-day pledged repo between banks) was 1.9642%, which was lower than the 7-day reverse repo rate.
Looking ahead, the special meeting of the Financial Committee of the State Council held on March 16 emphasized that to effectively revive the economy in the first quarter, monetary policy should take the initiative to respond, and new loans should maintain moderate growth.
From the perspective of the industry, the meeting released full determination to stabilize growth, stabilized expectations in a very timely manner, and boosted confidence.
"The escalation of geopolitical conflicts, rising commodity prices, rising global inflation, the withdrawal of easing policies in major economies, and intensified financial market volatility have brought greater uncertainty to the outlook for global economic development." said Wen Bin, chief researcher at Minsheng Bank. To achieve the 5.5% growth target, further policy support is needed.
Fiscal policy should further optimize the expenditure structure, increase expenditure, and play a supporting role in stabilizing investment in stabilizing growth as soon as possible.
Monetary policy should give full play to the dual functions of aggregate policy and structure, identify the right time, and there is still room for RRR cuts and interest rate cuts, increase efforts to boost demand, and promote economic operation within a reasonable range.
Zhou Maohua said that the market is still expecting RRR cuts and interest rate cuts in the second quarter, mainly because many places in China have been affected by the spread of the epidemic since March, real estate and consumer demand are in the recovery stage, and some industries are still under great operating pressure; external demand recovery, policy prospects Uncertainty remains high.
Under such circumstances, the market expects the central bank to take appropriate measures to promote reasonable credit expansion, guide financial institutions to increase support for weak links in the real economy and key emerging areas, stabilize market confidence, accelerate the recovery of domestic demand, and ensure that the economy operates within a reasonable range.
"Although there will be less pressure on MLF maturity in the next quarter, there will still be liquidity gaps caused by peak tax periods, centralized issuance of government bonds, and large maturity of interbank certificates of deposit. These may become triggers for RRR cuts." Mingming believes that, In order to guide financial institutions to increase credit supply and reduce loan interest rates, the current medium and long-term funding gap should be made up and the cost of bank liabilities should be reduced. RRR reduction is still one of the optional operations.
Recently, the regular meeting of the Monetary Policy Committee of the People's Bank of China in the first quarter of 2022 was held.
The meeting pointed out that it is necessary to maintain stability and seek progress while maintaining stability, strengthen cross-cyclical and counter-cyclical adjustment, increase the implementation of prudent monetary policy, enhance forward-looking, precision, and autonomy, and give full play to the total amount and structure of monetary policy tools. Dual functions, proactive response, boost confidence, provide stronger support for the real economy, and stabilize the macroeconomic market.