The central bank cut interest rates again after two years of official interpretation

The People's Bank of China [Weibo] decided to reduce the benchmark interest rates of RMB (6.1249, 0.0014, 0.02%) on loans and deposits from November 22, 2014. The one-year lending benchmark interest rate of financial institutions was lowered by 0.4 percentage points to 5.6%; the one-year deposit benchmark interest rate was lowered by 0.25 percentage points to 2.75%, and combined with the promotion of interest rate marketization reform, the upper limit of the floating range of deposit interest rates of financial institutions was determined by the deposit benchmark. The 1.1 times interest rate is adjusted to 1.2 times; the benchmark interest rates of other grades of loans and deposits are adjusted accordingly, and the benchmark interest rate term is appropriately deprecated.

The relevant person in charge of the central bank [microblogging] lowered the benchmark interest rate for RMB loans and deposits and further promoted the reform of interest rate marketization.

1. Q: What problems should be solved in this policy adjustment?

A: At present, China's economy continues to operate in a reasonable range, and economic restructuring has undergone positive changes. However, the real economy reflects the problem of “funding difficulties and expensive financing”. After the State Council launched a series of measures in July this year, the relevant parties have done a lot of work, and “funding difficulties and financing expensive” have shown a easing trend in some regions and fields. However, under the circumstance that there is downward pressure on economic growth, structural adjustment is in the climbing stage, and business difficulties have increased, some enterprises, especially small and micro enterprises, have reduced their ability to withstand financing costs. Solving the problem of high financing costs for enterprises, especially small and micro enterprises, is of great significance for stabilizing growth, promoting employment, and benefiting people's livelihood. The focus of this interest rate adjustment is to play the guiding role of the benchmark interest rate, to guide the downward trend of market interest rates and social financing costs, to promote the gradual return of real interest rates to a reasonable level, to alleviate the outstanding problem of high corporate financing costs, and to maintain sustained economic health. Development provides a moderately neutral monetary and financial environment.

2. Q: Does this interest rate adjustment mean a change in the orientation of monetary policy?

A: The interest rate adjustment is still a neutral operation and does not mean that the monetary policy orientation has changed. At present, China's economic operation is kept in a reasonable range, and the price increase generally shows a downward trend. The central bank needs to use the interest rate instruments to fine-tune and maintain appropriate real interest rate levels according to the operating conditions of the economic fundamentals. This is the proper meaning to uphold and improve the normal interest rate adjustment mechanism, and it is also the requirement to improve the pertinence and effectiveness of the prudent monetary policy. The current international environment is complicated. Although China's economy is also facing certain downward pressure, China's economy is large and the market space is broad. There is a lot of room for maneuvering to promote new industrialization, informationization, urbanization and agricultural modernization, and its ability to resist risks is relatively strong. . Generally speaking, China's macro-economy still maintains medium-to-high-speed growth, the price increase has declined, the economic structure has been continuously optimized and upgraded, and economic growth is shifting from factors and investment to innovation. Therefore, there is no need to adopt strong stimulus measures for the economy, and the stable monetary policy orientation will not change.

3. Q: What are the new measures to combine this policy adjustment with the promotion of interest rate marketization reform?

A: Practice has shown that the key to reform, the promotion of development through reform, and the full release of the reform dividend are the key to coping with the current complicated situation at home and abroad and promoting China's economic stability. In recent years, China's interest rate marketization reform has continuously made new progress. At present, the People's Bank of China [microblogging] only imposes an upper limit on the deposit interest rate of financial institutions. With the deepening of interest rate marketization reform, the formation and transmission mechanism of market-based interest rates have gradually improved, the governance structure of financial institutions has been continuously improved, and the independent pricing and risk control capabilities have been significantly improved. China has basically the basis for further advancement of interest rate marketization reform. condition. This policy adjustment is precisely the combination of monetary regulation and reform and deepening reform, including reform and regulation, perfecting and innovating macro-control methods, and further promoting the reform of interest rate marketization. The specific reform measures are mainly reflected in three aspects:

First, the loan and deposit benchmark interest rates will be lowered in an asymmetric manner. The reduction in the benchmark interest rate of this loan is greater than the deposit benchmark interest rate, which is an improvement on the traditional interest rate adjustment method, which reflects the more targeted guidance of market interest rates and social financing costs. From the point of view of loan interest rate, the benchmark interest rate still has important guiding significance for the pricing of financial products. The large reduction of the benchmark interest rate for loans will directly lower the loan pricing benchmark and drive down the price adjustment of other financial products such as bonds. At the same time as the policy was introduced, the People's Bank of China has required financial institutions to proceed from the overall situation of promoting economic and social development, earnestly assume social responsibilities, firmly establish the concept of financial services and real economy, implement the macroeconomic regulation and control, and reasonably determine loans according to the adjustment of the benchmark interest rate. The interest rate level, and through the market interest rate pricing self-discipline mechanism to guide financial institutions to reduce corporate financing costs. From the point of view of deposit interest rate, the small reduction of the deposit benchmark interest rate is combined with the expansion of the interest rate floating range, which is conducive to maintaining the positive interest rate at an appropriate level, maintaining the reasonable real income of depositors, expanding household consumption and boosting domestic demand.

Second, the upper limit of the floating range of deposit interest rates has been expanded from 1.1 times the benchmark interest rate to 1.2 times. This is another important measure for the market-oriented reform of China's deposit interest rate since the ceiling of the deposit interest rate in June 2012 was expanded to 1.1 times the benchmark interest rate. After the floating range of the deposit interest rate is expanded, if the commercial bank uses the upper floating range, the deposit interest rate after the floating is equal to the pre-adjustment level. At the same time, the independent pricing space of financial institutions has been further broadened, which is conducive to promoting the construction of its perfect pricing mechanism, enhancing its independent pricing ability, accelerating the transformation of business model and improving the level of financial services. It is also conducive to improving the market interest rate formation mechanism and better exerting its role. The decisive role of the market in resource allocation.

The third is the term of the benchmark interest rate for the deferred deposit and loan. Combined with the use of deposit and loan benchmark interest rates and their importance, the term of the benchmark interest rate for deposits and loans was simplified and consolidated, and the benchmark interest rate for five-year time deposits was no longer announced. Degeneracy is three grades within one year (including one year), one to five years (including five years) and five years or more. This will further broaden the independent pricing space of financial institutions, help guide financial institutions to actively change their business ideas, and improve market-based pricing power. It will also help strengthen the construction of market benchmark interest rate system, improve the transmission mechanism of interest rate policy, and further promote the reform of interest rate marketization. Create favorable conditions.

4. Q: How to continue to promote interest rate marketization reform in the next step?

A: After more than a decade of continuous advancement, China's interest rate marketization reform has made important progress. Especially since the 18th National Congress of the Communist Party of China, we have taken new steps in liberalizing interest rate control and improving the market-based interest rate formation mechanism. The further expansion of the upper limit of the deposit interest rate floating range will not only help to play a more decisive role in the formation of interest rates in the formation of interest rates, but also lay a solid foundation for the comprehensive liberalization of deposit interest rate control in the future. The depreciation of the benchmark interest rate term is also conducive to the financial institutions to adapt to the direction of interest rate marketization and to enhance the pricing capacity building, which will further play a decisive role in the market allocation of resources. In the next step, we will closely monitor, track and evaluate the implementation effects of various interest rate market-oriented reform measures, and comprehensively consider the domestic and international economic and financial development situation and the maturity of the basic conditions required for reform, and timely promote large-scale issuance for enterprises and individuals. In the form of deposit receipts, etc., we will continue to promote the marketization of deposit interest rates in an orderly manner, and at the same time further improve the market-based interest rate system and interest rate transmission mechanism, and continuously enhance the effectiveness of the central bank's interest rate regulation and control and macro-control.

The interest rate marketization reform is also a systematic project, which needs to be coordinated and coordinated with other reforms. To this end, it is necessary to strengthen the overall coordination of various reform measures, form a joint force for reform, and finally establish an institutional mechanism that gives full play to the decisive role of the market in resource allocation and better plays the role of the government. (Finish)

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