China can afford a looser monetary policy – Global Times

According to the latest story carried by the Global Times on Friday, the Chinese central bank, the People’s Bank of China (PBOC) is seen easing its monetary policy further in the coming months following the rate cut in the Medium-term Lending Facility (MLF).

The MLF rate cut signals that the PBOC may lower Loan Prime Rate (LPR) going forward.

Key Quotes:

“China's monetary policy may switch gears in the coming months with the recent interest rate cut of its medium-term lending facility (MLF) signaling a lower loan prime rate (LPR).

A Stronger yuan against the US dollar also provides more policy maneuvers for the Chinese monetary authority to follow suit in the new trend of global monetary easing.

China's current situation means its central bank can afford lower interest rates.

If there is a new wave in the global economic downturn, China is better prepared and has more countermeasures in the bag than other countries like the US.”

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