[Financial Associated Press Review: Restarting PSL is a positive signal and the trend of volume and price must be closely watched]On October 10, the Financial Associated Press reported that the long-lost policy tool PSL once again entered the market’s vision. On October 8, the People’s Bank of China announced the development of mortgage supplementary loans (PSL) in September 2022: the China Development Bank, the Export-Import Bank of China, and the Agricultural Development Bank of China added a net new mortgage supplementary loan of 108.2 billion yuan. This is the first time in the past two years that the balance of PSL has experienced positive monthly growth. Although the net increase is only 100 billion yuan, it still arouses strong market attention. PSL reactivation is a clear signal of steady growth. It is an existing arrangement to underpin the economy through policy tools, and the central bank’s activation of the PSL this time is also a concrete manifestation of stabilizing growth at the implementation level. Some market participants believe that with reference to historical experience, reactivating the PSL means that the shantytown reform will have to take on the heavy responsibility in the combination of stable growth in the future. But this kind of speculation is slightly redundant. Although PSL’s initial currency shed reform business accounted for a large proportion, it does not mean that this tool can only support shed reform. The author believes that the monthly balance and interest rate level of PSL in the next period of time are worthy of close attention by the market. As one of the policy tools, PSL is not only an important channel for the central bank to expand its balance sheet and release base money, but its financing rate also has an indirect impact on the market. (Commentator Liang Kezhi)
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