PBoC: Further easing possible if slowdown gathers too much pace - BBH

Research Team at BBH, notes that the People’s Bank of China has been on hold since October 2015, when it cut policy rates 25 bp. 

Key Quotes

“The cumulative easing of 165 bp in the 1-year lending rate since November 2014 has had the desired impact, with new loan growth expanding significantly since mid-2015.  CPI rose 2.0% y/y in May, the lowest since January and well below the targeted 3%.  The economy continues to slow at a manageable pace, but further easing is possible this year if the slowdown gathers too much pace.”