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M2 growth rate hit a 28-year low interest rate cut imperative

2015 first financial data due out February 13, financial institutions 1.47 trillion in new loans in January, compared with an increase of 289.9 billion yuan, but the money supply growth rate hit a 28-year low, alarm sounded liquidity analysis that reduced rate cut again, or just around the corner. Meanwhile, the Central Bank the day before reverse repurchase operations on the open market to 160 billion yuan, which was the seventh since this year using the tool to market liquidity. Therefore, whether it is a drop or a cut, not only space but also is possible.
in January 2015, financial institutions in new Yuan loans of 1.47 trillion, up from 2014 130 million yuan in the same period, compared with an increase of 289.9 billion yuan, which means that as the Central Bank to ease monetary policy, commercial bank lending began to pick up speed. M2 (broad money) rose 10.8% data showing that this is the lowest level since December 1986. Market growth rate of M2 as indicators to measure credit or liquidity,
2014 depressed state has rendered the money supply. 2014 annual M2 growth slipped to 12.2%, create an eight-month low, also lower than the Central Bank about 13% 's growth target for the year. For the M2 growth rate hit a 28-year low, ANZ, Director of research for greater China Liu Ligang believes that Central Bank cut interest rates drop and again imperative. In his view, the M2 growth rate decline was mainly due to Chinese enterprises to repay dollar debt capital outflows, in order to keep the money supply at a reasonable level, the Central Bank should continue to inject liquidity into the market, to ease monetary policy as soon as possible.
social harmony M2 growth, both record low means that the future economic and CPI to remain under downward pressure. Monetary growth continued to drop, and, they don't exchange rate depreciation of the case, plus money market rates higher real interest rates remain high, tight monetary conditions. Such as our previous analysis, the only reliable way to relax is to guide the effective interest rate down.
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