PBOC unlikely to alter the RRR this year – Goldman Sachs

Analysts at Goldman Sachs predict that China’s central bank will refrain from cutting the Reserve Ratio Requirement (RRR) this year.

Key quotes

“Instead, the People's Bank of China might rely on: Open market operations, its medium-term lending facility and targeted tools to keep liquidity supply and demand relatively stable.”

 “Amid tight regulations on property financing, shadow banking, and local government borrowing, as well as increased supervision on anti-corruption, credit demand has remained soft.” 

• USD/CNY fix: 6.4300 vs the estimated 6.4295