Experts Say China's New Stimulus Measures Are Beneficial for the Economy
On Tuesday, China announced a range of stimulus initiatives, which include the People's Bank of China reducing the cash reserves that banks must maintain, along with several important monetary policy adjustments designed to enhance economic growth and stabilize the property market. Analysts have commented that these measures are both significant and positive, highlighting the Chinese government's commitment to stabilizing economic growth.
TroibNews 
On Tuesday, China introduced a range of stimulus measures designed to enhance economic growth and stabilize the property market. These measures include reducing the reserve requirements for banks and implementing additional policy changes.
Analysts view these steps as both significant and positive, reflecting the government’s commitment to stabilizing economic growth.
A report from the Chinese think tank CF40 indicates that the People's Bank of China's initiatives show a definitive aim to stabilize economic growth, the stock market, and the real estate sector. The report highlights expectations for an overall decrease in interest rates, emphasizing that this approach is more effective in fostering economic stability than merely adjusting reserve requirement ratios. Additionally, the report points out that the PBOC's decision to lower mortgage rates on existing loans could provide direct support to household cash flow and help stabilize outstanding household credit.
Lynn Song, chief economist for Greater China at ING, remarked to CNBC that the announcement of multiple measures simultaneously represents a "step in the right direction." He indicated that this approach is more effective than introducing isolated measures that might have limited impact. Song also believes that there is potential for further easing of monetary policy in the coming months, especially as many global central banks are moving toward cutting rates.
Eswar Prasad, an economics professor at Cornell University, expressed to the Financial Times that this "quantitatively modest but symbolically significant" set of measures demonstrates the government's readiness to employ macroeconomic stimulus to support weakening economic activity.
Overall, most experts agree that the PBOC's actions have surpassed expectations and are likely to enhance market confidence, at least in the short term.
Frederick R Cook for TROIB News
Analysts view these steps as both significant and positive, reflecting the government’s commitment to stabilizing economic growth.
A report from the Chinese think tank CF40 indicates that the People's Bank of China's initiatives show a definitive aim to stabilize economic growth, the stock market, and the real estate sector. The report highlights expectations for an overall decrease in interest rates, emphasizing that this approach is more effective in fostering economic stability than merely adjusting reserve requirement ratios. Additionally, the report points out that the PBOC's decision to lower mortgage rates on existing loans could provide direct support to household cash flow and help stabilize outstanding household credit.
Lynn Song, chief economist for Greater China at ING, remarked to CNBC that the announcement of multiple measures simultaneously represents a "step in the right direction." He indicated that this approach is more effective than introducing isolated measures that might have limited impact. Song also believes that there is potential for further easing of monetary policy in the coming months, especially as many global central banks are moving toward cutting rates.
Eswar Prasad, an economics professor at Cornell University, expressed to the Financial Times that this "quantitatively modest but symbolically significant" set of measures demonstrates the government's readiness to employ macroeconomic stimulus to support weakening economic activity.
Overall, most experts agree that the PBOC's actions have surpassed expectations and are likely to enhance market confidence, at least in the short term.
Frederick R Cook for TROIB News
