Promote a steady decline in the overall financing cost of society
2024-08-16
한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina
The total amount of finance has grown reasonably, the credit structure has continued to be optimized, the financing cost has been steadily declining, and the RMB has been steadily appreciating against a basket of currencies... Since the beginning of this year, the prudent monetary policy has been flexible, moderate, precise and effective, strengthening counter-cyclical regulation and creating a good monetary and financial environment for economic and social development.
The recent meeting of the Political Bureau of the CPC Central Committee pointed out that it is necessary to comprehensively use a variety of monetary policy tools, increase financial support for the real economy, and promote a steady decline in the overall financing cost of society. Industry insiders said that in the next stage, monetary policy should continue to maintain a reasonable growth in financing and money supply. While preventing funds from accumulating and spinning, financial institutions should be supported to follow the principles of marketization and rule of law, deeply tap into effective credit demand, accelerate the transformation of reserve projects, and enhance the stability and sustainability of loan growth.
Improve the efficiency of capital use
Since the beginning of this year, the complexity, severity and uncertainty of the external environment have increased, bringing more adverse effects; insufficient domestic effective demand, and the continued deepening of the transformation of new and old drivers and structural adjustments have also posed certain challenges. In January, the People's Bank of China lowered the re-loan and re-discount rates for supporting agriculture and small businesses by 0.25 percentage points, and lowered the reserve requirement ratio by 0.5 percentage points, releasing more than 1 trillion yuan of medium- and long-term liquidity, providing the market with ample liquidity and significantly reducing the cost of bank funds. In February, the loan market benchmark rate (LPR) for more than 5 years fell by 0.25 percentage points, the largest drop since the LPR reform in 2019. Experts believe that the monetary policy was implemented early and vigorously at the beginning of the year, supporting the economy to get off to a good start.
At present, the balance of RMB loans in my country is close to 250 trillion yuan, which is already a large amount. Activating the existing credit is of great significance to improving the quality and efficiency of financial services for the real economy. Experts said that with the transformation and upgrading of the economic structure and the improvement of the efficiency of the conversion of new and old growth drivers, the efficiency of the use of existing resources will also be significantly improved. Although this will not be reflected in the increase of loans, it can also inject new impetus into the high-quality development of the economy.
"In recent years, with major changes in the supply and demand relationship in the real estate market, the demand for real estate loans has tended to decline, and the proportion of loans will naturally decline; the prevention and resolution of local debt risks has entered deep waters, and some local financing platform loans will be gradually repaid; the clearance of 'zombie enterprises' and the revitalization of existing assets in infrastructure investment will be able to reduce some inefficiently occupied existing loans." Pang Ming, chief economist of JLL Greater China, believes that freeing up loans from inefficient areas and investing them in key areas and weak links can improve the efficiency of fund use and better support high-quality economic development.
Industry insiders said that in order to support economic growth, revitalizing existing loans, improving the efficiency of using existing loans, avoiding idle capital, and optimizing loan investment are equally important as new loans. The Theoretical Learning Center Group of the Party Committee of the People's Bank of China recently wrote an article pointing out that in the next stage, the People's Bank of China will focus on revitalizing financial resources that are inefficiently occupied, continue to strengthen monitoring, pay close attention to the transfer and lending of corporate loans, strengthen cooperation with multiple departments, improve the management and assessment mechanism, and promote the improvement of the efficiency of fund use.
Optimize the capital supply structure
Since the beginning of this year, the central bank has set up 500 billion yuan of re-loans for scientific and technological innovation and technological transformation, and 300 billion yuan of re-loans for affordable housing; relaxed the identification standards for inclusive small and micro loans, expanded the scope of support for carbon emission reduction support tools, and implemented various existing structural monetary policy tools. Overall, loans in key areas maintained rapid growth. At the end of June, inclusive small and micro loans and medium- and long-term loans in the manufacturing industry increased by 16.9% and 18.1% year-on-year respectively, and green loans increased by 28.5% year-on-year, both exceeding the growth rate of all loans.
At present, it is of vital importance to promote the stable and healthy development of the real estate market. On May 17, the central bank launched a policy combination for the real estate market, reducing the minimum down payment ratio for personal housing loans, canceling the lower limit of personal housing loan interest rates, and lowering the interest rate of provident fund loans, reducing the cost of housing purchases for residents, and releasing rigid and improvement housing demand. At the same time, a 300 billion yuan re-loan for affordable housing was established to support the destocking of the real estate industry. Data show that in the first half of the year, the year-on-year decline in the sales area and sales of newly built commercial housing nationwide narrowed by 1.3 and 2.9 percentage points respectively compared with the previous five months.
Regarding the main ideas for the next stage, the "China Monetary Policy Implementation Report for the Second Quarter of 2024" recently released by the central bank pointed out that we must fully recognize the new changes in the supply and demand relationship in the real estate market, conform to the people's new expectations for high-quality housing, and strive to promote the implementation of the issued financial policy measures to promote the stable and healthy development of the real estate market. Guide financial institutions to strengthen financial guarantees, increase the construction and supply of affordable housing, meet the rigid housing needs of the working class, support the diversified improvement of housing needs of urban and rural residents, increase financial support for housing rental, promote the acceleration of the establishment of a housing system that combines rental and purchase, and accelerate the construction of a new model of real estate development.
Wen Bin, chief economist of China Minsheng Bank, believes that financial support for the housing rental industry is conducive to balancing the current and long-term. In the short term, the current real estate market is in a special period of adjustment. Increasing support for the housing rental industry will help to activate the stock and destock, balance the supply and demand of the real estate market, and stabilize expectations.
Sending clearer interest rate regulation signals
The Third Plenary Session of the 20th CPC Central Committee proposed to improve the macro-control system and coordinate the reform of key areas such as finance and taxation.
Recently, the central bank adjusted the bidding method for open market operations and strengthened the main policy interest rate attributes of the 7-day reverse repurchase operation interest rate in the open market to improve operational efficiency and stabilize market expectations. The central bank also increased temporary positive and reverse repurchase operations to guide market interest rates to better operate smoothly around the policy interest rate center. "The increase in temporary positive and reverse repurchase operations this time makes liquidity management more scientific and standardized, and the level of operational refinement is further improved. Among them, temporary reverse repurchase provides liquidity, and temporary positive repurchase recovers liquidity. At present, the central bank selects opportunities to operate. The combination of the two can achieve two-way liquidity adjustment and better smooth out the disturbance of liquidity caused by factors such as tax period and end-of-quarter assessment." Zhou Maohua, a macro researcher at the Financial Market Department of Everbright Bank, analyzed.
In recent years, my country has continued to promote the reform of the loan market benchmark interest rate (LPR) and has achieved remarkable results, driving the continuous decline in corporate financing and resident credit costs. Data shows that since the LPR reform in 2019 until June this year, the weighted average interest rate of corporate loans has dropped by 165 basis points to 3.65%; the interest rate of personal housing loans has dropped by 201 basis points to 3.49%.
In general, the process of deepening interest rate marketization reform is gradual. In the next step, the central bank will always maintain the stability of monetary policy, further improve the market-oriented interest rate formation, regulation and transmission mechanism, enhance the authority of policy interest rates, study the appropriate narrowing of the interest rate corridor, and send a clearer interest rate regulation target signal to the market. At the same time, continue to reform and improve LPR, focus on improving the quality of LPR quotations, better play the role of interest rate self-discipline mechanism, maintain a rational and orderly competition order, smooth the interest rate transmission channel, and continue to create a good monetary and financial environment. (Economic Daily reporter Yao Jin)
Source: Economic Daily
