In October, LPR continued to "standstill"

The probability of a recent RRR cut and interest rate cut is unlikely

　　News from our newspaper (Reporter Cheng Jie) Yesterday, October LPR (loan market quote interest rate) was released. The 1-year LPR was 3.85%, and the 5-year LPR was 4.65%.

As expected by the market, the 1-year and 5-year-old varieties are the same as last month. So far, LPR quotations have remained unchanged for 6 consecutive months.

Analysts generally believe that the follow-up of monetary policy will continue to focus on stability, and the probability of a RRR cut and interest rate cut before the end of the year is unlikely.

　　Previously, the market had strong expectations for the LPR quotation to remain unchanged this month, because the MLF bidding interest rate remained unchanged on the 15th of this month, and MLF is the reference basis for LPR quotation.

　　On the 14th of this month, Sun Guofeng, Director of the Monetary Policy Department of the Central Bank, said at a press conference on financial statistics for the third quarter of 2020 that in recent months, as the epidemic has been effectively controlled, the domestic economy has recovered well, and the central bank’s policy interest rate is consistent with The LPR quoted interest rates in the loan market remained stable, and the market interest rates revolved around the central bank's policy interest rate, and the interest rate level generally matched the current economic fundamentals.

　　Wang Qing, chief macro analyst at Oriental Jincheng, pointed out that LPR quotations have remained unchanged for six consecutive months. The fundamental reason is that the domestic epidemic has been effectively controlled during this period and the macroeconomic "V-shaped reversal", represented by interest rate cuts and RRR cuts The overall easing will no longer increase, and the monetary policy will pay more attention to the balance between stabilizing growth and preventing risks.

　　Hue, the chief economist of Founder Securities, believes that the central bank will continue to implement a normalized monetary policy with a moderate degree of tightening when the macro economy continues to improve and both sides of supply and demand are repaired.

Monetary policy will focus on stability and will not be too tight. In terms of liquidity, it will provide sufficient support based on demand.