On December 20, the National Interbank Funding Center announced a new version of the LPR (loan market quoted rate) quotation: the one-year variety was quoted at 3.80%, 5 basis points lower than last time; the five-year and above varieties were quoted at 4.65%, which was the same as last time. flat.
According to relevant professional media reports, the reduction in the 1-year LPR quotation not only directly promotes the reduction of financing costs in the real economy, but also shows that in the context of economic development facing the triple pressure of shrinking demand, supply shocks, and weakening expectations, monetary policy is increasing in a timely manner. Countercyclical regulation plays an important signaling role in stabilizing market expectations, alleviating downward pressure on the property market, and driving restorative growth in consumption and investment.
Based on past experience, each round of monetary easing cycle consists of multiple RRR cuts and interest rate cuts. This round of easing cycle only implemented 2 RRR cuts and the LPR only lowered the 1-year interest rate by 5 basis points. In terms of intensity, it is not enough. Future policies will continue There is still plenty of room and scope for performance. Therefore, outsiders judge that there is a high probability of further RRR cuts or interest rate cuts in the first half of 2022, and they do not rule out the possibility of a slight reduction in the MLF winning interest rate. It can be said that domestic monetary policy has gradually turned loose in order to support a new round of stable growth.
It is reported that the current and future period will be a window period for China’s monetary policy to be loose. Once the Federal Reserve starts to raise interest rates in the second quarter, China’s CPI will enter an upward channel, which will form obvious constraints on monetary policy. It is very important to release policy dividends during this rare window period. The essential.
In this regard, cotton professionals believe that RRR and interest rate cuts will help alleviate the downward pressure on cotton prices and play a role in supporting and stabilizing cotton prices. The specific support will depend on the intensity of subsequent RRR or interest rate cuts.
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