NEWS: China's deposit rate is still likely to fall in 2019

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The Bank of Communications Finance Research Center released its outlook report for 2019 on Friday, saying that China's macro-policy will be more active, steady growth will be strengthened, and the margin of sound monetary policy will be relaxed; monetary policy will be "stable currency, increase credit" to cooperate with "lenient finance, promote investment", and deposit reserve ratio will still be further reduced, but the scope and frequency will be small. In 2018.
In its "macroeconomic and financial outlook for 2019", the bank also pointed out that China's economic growth is expected to be 6.4% in the fourth quarter of 2018 and 6.6% in the whole year, and 6.3% in 2019, which may be low and stable throughout the year.
"Directional loosening" should be the direction of operation of monetary policy tool mix in 2019. Directional lowering + adjustment of monetary market tool will be the basic tool mix,"the report said. In the future, central banks may continue to use various tools to guide liquidity flow allocation and term allocation, and combine conventional policy tools with structural liquidity management tools.
The report points out that the domestic economy is still facing downward pressure and the foreign exchange share may be at a low level in 2019, so it is necessary to increase market liquidity moderately through the decline of the deposit rate. However, in order to avoid "flooding", it is impossible for the deposit rate to continue to decline substantially when the liquidity has basically reached a reasonable sufficient level.


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