China: Credit easing kicks in – Standard Chartered

Sandeep Kanihama FXStreet Contributor

Lan Shen, economist at Standard Chartered, points out that the China’s January SMEI reading shows a marginal improvement in SMEs’ business performance entering 2019.

Key Quotes

“The headline SMEI (Bloomberg: SCCNSMEI <Index>) – based on our monthly survey of more than 500 SMEs – edged up to 54.9 in January from 54.7 in December.”

“The ‘current performance’ sub-index advanced 0.4ppt from December and was 1.0ppt higher than in January 2018. The ‘credit’ sub-index picked up 1.2ppt from December and was 1.5ppt higher than January last year. This suggests a brighter start to this year compared to 2018, supported by improved credit support.”

“We expect the relaxation of criteria for banks’ eligibility for targeted RRR cuts, the targeted medium-term lending facility (TMLF) and the recent RRR cut to incentivise banks to increase credit allocation to SMEs and lower their funding costs.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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