This is the 957th original article by Panda Babe:
#央行开展1年期MLF操作2000亿元 Interest rates remain unchanged #
In addition to the annual 315 International Consumer Rights Day, 15 March 2022 is also the second day of the "Super Central Bank Week", the most critical part of global financial and monetary policy.
Well, for China, the current consumption and domestic demand are sluggish, and the protection of consumer rights and interests is not a core contradiction and concern.
The key is to look at the overall environment, to see the monetary policy, to see the attitude of the central mother.
Just on March 15, it will become a key node for the world's two largest economies, China and the United States, to adjust monetary policy and manage interest rates:
The Fed will announce a rate hike and the central bank will decide on the interest rate on the MLF.
For China's domestic economic environment, the trend of the MLF is crucial and critical, because China's financial market has in fact shown a lack of confidence, the characteristics of a technical bull market that continues to decline, the economic environment is generally under pressure, and the financial data is not as good as expected, so the market is generally very concerned about the trend of the central bank's key interest rate in March:
If it is only to respond to the current demand, then it will indeed reduce the MLF, and if China really decides to fight a protracted war, then the much-anticipated MLF will not have a downward movement.
So March 15, MLF interest rates, very important.
At 9:20 a.m. on March 15, the central bank announced the operation of the open market through its official website, sending an important signal: there is a high probability of no interest rate cut this month.
Image source: the official website of the central bank
As you can see from the chart above, the winning rate for the 1-year MLF is still 2.85%, the same as on February 15 (below):
The 1-year MLF (Medium-Term Lending Facility) is the most important policy rate today and the benchmark for LPR (Loan Market Quote Rate). LPR, which can be understood as the current loan benchmark interest rate.
If the MLF does not move, then the LPR is basically impossible to adjust. The MLF launched on the 15th of each month is to determine the direction of the LPR interest rate for the current month. The LPR rate will be announced next Monday, which is basically certain that there will be no rate cut.
Financial markets are very responsive: on March 15, China's A-shares lacked confidence and went all the way down.
Image source: Network
Cause and effect are clear, and reality speaks.
The stock market continues to decline, the property market is depressed, and the economic environment is under obvious pressure, so why does the central bank not cut interest rates under such a comprehensive environment?
This is a good question, but also an important issue worthy of in-depth discussion and study, related to the people's livelihood economy and every Chinese.
This article conducts in-depth analysis and interpretation of the determination of the key interest rate of the central bank's MLF based on several dimensions.
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1
Behind the determination of "no interest rate hikes", what are the practical considerations of the central bank?
The epidemic has fought back again, the real economy is under pressure, domestic consumption is sluggish, there is a shortage of water in markets at all levels, and the pressure on the property market and the stock market is huge... Obviously, these can not be the reasons for prompting or deciding on further interest rate cuts in the country, looking at the problem should be divided into priorities, not to say that these economic realities should not be expressed, the central mother does not cut interest rates, there are always reasons, and such reasons, the reasons for deciding to maintain concentration and monetary stability, must play a major role in the current economic environment, the core role.
Objectively speaking, this is a sense of separation between the micro market and the macro overall situation, from the perspective of the country, grasping the big and letting go of the small, concentrating on solving the main problems, it is inevitable that some of the actual needs of the micro market will not be taken into account.
The sideways trend of the MLF key interest rate, the scale of 200 billion yuan is extremely restrained, not that the country does not consider the needs of the current domestic economic environment, after all, before the announcement, the market for interest rate cuts, loose demand is reasonable, but also clear.
On March 15, 2022, the MLF will remain unchanged, mainly due to the following practical considerations:
1. The strategic shift of the United States towards China's economy, finance, and assets has become more and more obvious:
Shorting China's financial market, suppressing Chinese stocks, and delinking China from pressure in the financial market has formed an obvious squeeze on capital that has no morality and backbone to speak of.
Therefore, the resulting capital is flowing out of China openly and secretly, northbound funds are also withdrawing from China, if China cuts interest rates, the Sino-US interest rate differential narrows, coupled with the United States immediately raising interest rates, it will further lead to capital outflows.
Stabilizing key interest rates, hedging short capital, preventing capital outflows, and ensuring market stability are the first reasons.
2. The silent financial war has begun, and the RMB exchange rate has begun to weaken:
How to maintain the stability of the exchange rate and not let the RMB depreciation is a problem.
Because the depreciation of the renminbi in the short term will have an impact on the domestic economy, will accelerate the speed of capital escape, and there are many unpredictable risks and problems, then in the context of economic pressure, the meaning of stability overrides everything, which is the meaning.
Since late February, the exchange rate has been rising and THE RMB has been depreciating.
The reference price of the RMB exchange rate has been reduced by 600 points in the past three days, which can be said to be a mountain of pressure.
The reason for the decline in the RMB exchange rate, especially in the context of the absence of an important adjustment in China's import and export trade, is obviously the dumping of RMB assets by foreign capital, mainly because of the exchange rate pressure formed by Chinese government bonds.
The indiscriminate selling of Chinese and RMB-related assets by foreign capital has become very obvious, and it is an indisputable fact that the trend from the previous darkness of Chen Cang to the current trend has become the trend.
The United States, which controls global capital, has officially launched an offensive against China on the financial battlefield, and the most important thing at this time is to grasp certainty and not make key adjustments.
In a chaotic and foggy environment, maintaining concentration is an inevitable choice.
3. The Conflict between Russia and Ukraine is still continuing, and the subsequent trend of uncertainty and risk impact make China's domestic economic control inevitably tend to be conservative.
This does not need much explanation, the world's capital can not be stable because of the Russian-Ukrainian conflict, and the threat of US hegemony still exists, in this case, there is no possibility, nor is there a condition to engage in economic stimulation and pull the market situation.
4. The Federal Reserve will announce the latest developments in monetary policy this week.
The enemy does not move, I do not move, very understandable, right?
Thanks to China's basic people's livelihood security system, at this critical moment of the global financial and capital game, it is very reasonable to maintain concentration and static braking in the case that the opponent's bottom card has not yet been seen.
In general, from the perspective of the great power game, the macro environment, including risk considerations, etc., this time MLF chose to go sideways, maintain restraint and determination, and there are good reasons.
Unexpectedly, and reasonably, this is also in line with the prediction and expression that I have always insisted on China's monetary policy and economic environment of "loose on the outside and tight on the inside, wide in shape and in real terms".
2
Corresponding to the analysis of reality: the pressure on the property market, stock market, domestic economy and consumer market continues
Of course, the current actual situation is that individuals obey the collective, micro and macro reality, MLF sideways, then LPR is bound to be sideways (because MLF is the basis of LPR), which is for China's property market, stock market, and consumer field, the current pressure reality, may have to maintain a continuous state.
The biggest pressure now is not the economic individual and the market, but the banks.
Keeping the cost of money flow stable at the national level, and the economic environment needs to be stimulated and supported, then the banks responsible for putting money into the market are currently the main bearers of multi-dimensional pressure.
Look at it separately:
The stock market needless to say, the current state continues to pump water from the stock market, it is obvious that it is to use magic to prepare to fight magic, let the withdrawal of foreign capital go in a state of loss of cutting flesh and bloodletting, and then stuck the financing costs of financial institutions, actively and comprehensively curb the market to coax the market, harvest the game of retail investors.
The MLF remains unchanged, preferring to idle between banks rather than flow to financial markets where risk and markets continue to decline.
The stock market since March has no analytical significance in the short term, and the performance of the market explains all the problems, not much explanation.
The financial relaxation of the property market will have further space with the policy, but the essence of this space is that the bank should give profits to the market from the interest dimension, once it is a profit, it will inevitably produce obstacles, although the downward trend of mortgage interest rates, but the profit squeeze will also force banks to tighten their pockets, so at this stage, the policy relaxation of various cities must run to the front of financial support.
Without the support of the market, superimposed on the consideration of bank profits, the stabilization of the property market, including the rebound, takes longer.
The consumer field is worth mentioning, is a large number of consumer loans (high interest rates), become a port for the current bank to the market to release water, of course, the bank will not come forward, through a variety of loan intermediaries and small loan platforms, to the Internet online loan channel for large-scale high frequency release, this believes that as long as the mobile phone people can find, from the years down, all kinds of loan advertising is overwhelming.
However, the pulling effect of this kind of overdraft lending on the economy can be ignored, but there is also the possibility of increasing the financial risk of banks, and it is inevitable for the state to curb it in the short term.
In general, the domestic economy in the context of imported inflation and the changing international situation, the maintenance of stability is overwhelming, for any money outlet and opportunity, until the attitude at the national level has not changed, do not have any ideas.
The environment is not easy, and it is difficult to overcome the times.
3
Trend Analysis: What are the possible directions for China's monetary policy and economic stimulus in the future?
The Fed's monetary policy trend and the strategic shift of the United States against China after the Russian-Ukrainian conflict will become the two most critical external factors that determine the next, China's domestic economic stimulus support and monetary policy adjustment.
Time, on the Chinese side, because of the Chinese national system, the endurance and resilience to stabilize the fundamentals are beyond doubt, and it is not a big deal that everyone tightens their belts and lives a hard life for a while.
But the decision is on the part of the United States, and now in the face of inflation and currency failure, the United States, which is difficult to ride the tiger, has in fact reached a very critical crossroads of fate.
Although there is no practical significance in singing down the United States, from the perspective and perspective of China now, the self-destruction and total collapse of the United States may be the most ideal direction.
In order to maintain its hegemonic position, the United States continues to maintain the global harvest of the dollar, and only wins through the existing rules, then the most important point is to hope that the countries in the world except the United States will fall into chaos.
If the United States wants to be good, the whole world will have chaos, then all capital, wealth, and talent will run to the United States;
If China wants to be good, then it needs peace and stability in the world and pay attention to rules, so that china's competitive advantage can be released to the greatest extent.
Thousands of Chinese people around the world, on the basis of survival and development and competitiveness, under the same stable environment, they really have not encountered any opponents.
Therefore, the follow-up domestic monetary policy and economic stimulus in China will, to a large extent, respond to multi-dimensional challenges and shocks from the United States in the form of a dynamic change.
This is destined to be a difficult, torturous, and continuous game process in 2022.
Waiting for the Fed to make its statement and monetary policy clear, this is a key node, once the dollar raises interest rates, then the space for the renminbi to cut interest rates is contained (this is well understood, the clear interest rate trend, determines the flow of profit-seeking capital).
Capital competition is a battle of national fortune.
On the other hand, that is, the United States will inevitably strengthen the blockade against China and the encirclement and blockade to curb China's development in terms of multi-dimensional strategic turn challenges and impacts, finance, trade, industrial chain, science and technology, etc.
From the perspective of the country, concentrating forces and seeking breakthroughs has become an inevitability, since the face is torn, there is nothing to talk about, there is no long-term cooperation that can be imagined, and a comprehensive decoupling from finance to entities is inevitable.
The general environment determines micro-manipulation, international economic and trade relations determine the domestic economy and monetary strategy, at present, it is not only Russia that is betting on the national fortune, in fact, China is also sitting on this gambling table.
Under the premise that the overall situation is undecided, there is no possibility of monetary easing and economic stimulus.
Write at the end:
Very moments, concentration and calmness, the square is the right way
Of course, the financial and monetary dimensions are only one aspect, from the perspective of peeking at the leopard and finding signals, in fact, more and more people can feel that China's domestic economy is in a relatively depressed and convergent state, which is a typical contraction defense posture.
Defend against what? Of course, there are already many dimensions of interest association, and the increasingly obvious risks, shocks, and routine harvests.
In fact, until the economic problems and currency risks in the United States have not been fully released and the trend is clear, China's focus on stability and stability at the national level is certain.
This week is very critical, let's give you a review:
- Monday: Meeting of the Finance Ministers of the Euro Zone.
- Tuesday: The Reserve Bank of Australia announces the minutes of the monetary policy meeting; the new office of the State Council holds a press conference on the operation of the national economy.
- Wednesday: The National Bureau of Statistics released a monthly report on residential sales prices in 70 large and medium-sized cities; the IEA released a monthly crude oil market report.
- Thursday: The Fed announces its interest rate decision; Fed Chairman Jerome Powell holds a monetary policy press conference; the Reserve Bank of Australia publishes its Economic Gazette; ECB President Christine Lagarde speaks; and ECB Chief Economist Lane speaks.
- Friday: The Bank of Japan announces its interest rate decision.
During the week of the global super central bank, many key and decisive macro strategies and signals will emerge.
Of course, the pressure and difficulties in all aspects of China's economy at present needless to say, have been transmitted to the field of people's livelihood and employment, but the situation of the general environment should also be fully seen and understood, difficulties are realistic, but any game and competition is bound to be limited, in such a competition patience and determination of the key decisive stage, for China's economic individuals, calm, believe in the country, overcome the difficulties together, is the best choice.
MLF and LPR, including a range of stimulus instruments and policies, may have been prepared long ago, and the modern era is waiting for the right time.
Be positive and optimistic, be cautious and persistent, and don't fall into the darkness before the dawn comes.
With this article, I would like to encourage you with all readers and friends.
Key macroeconomic game stages, follow-up related trend analysis, daily follow-up, please pay attention. [A flash of inspiration]
(According to the latest regulations of the relevant state departments, the content and opinions of this article are for reference only, and do not constitute any clear suggestions on property purchase, investment, etc., and enter the market at your own risk.) ）
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