original title:Structural Monetary Policy Targeted Force
After the overall RRR cut, the support of agriculture and small enterprises has renewed efforts. On December 7, the latest re-lending and rediscount rate table released by the People’s Bank of China showed that the three-month, six-month, and one-year interest rates for agricultural and small-scale refinancing were 1.7%, 1.9%, and 2%, respectively. This means that the interest rate of refinancing for agriculture and small businesses has been reduced by 0.25 percentage points.
This is the first time that the central bank has lowered the interest rates of refinancing for agriculture and small businesses again after more than a year. In July 2020, the central bank lowered the interest rate on refinancing for agriculture and small businesses by 0.25 percentage point. Relending is one of the typical monetary policy tools that directly reach the real economy. There are clear requirements for the use of funds to ensure that the funds go directly to the weak areas and weak links of the real economy.
Zhang Xu, chief fixed income analyst at Everbright Securities, believes that the current corporate earnings imbalance is more prominent: on the one hand, rising commodity prices have distorted the balance between the upstream and downstream of the industrial chain and increased the cost pressure on downstream industries. On the other hand, affected by factors such as the epidemic and rising raw material prices, the profit growth rate of small and micro enterprises is lower than that of large and medium-sized enterprises. Therefore, there is an urgent need for precise monetary policy to further strengthen financial support for the real economy, especially for small and micro enterprises.
Wang Qing, chief macro analyst at Oriental Jincheng, believes that in the context of the current macroeconomic facing new downward pressure, small and micro enterprises still have the problem of rising costs caused by the high “scissors gap” between PPI and CPI, and they need to increase targeted assistance. After lowering the interest rate of refinancing loans to small and micro enterprises, the interest rate of inclusive financial loans issued by banks to small and micro enterprises will also be lowered, which will ultimately help stabilize employment and stabilize macroeconomic operations. This move reflects the recent policy orientation of “making policies around the needs of market players and using multiple currency tools”, “increase support for the real economy, especially for small, medium and micro enterprises, and promote a steady decline in overall financing costs”.
Wen Bin, chief researcher of China Minsheng Bank, said that the current “agriculture, rural areas and farmers” and small and micro enterprises are still weak areas in economic development and need to further increase financial support. In terms of volume, as of the end of September this year, the balance of reloans for supporting agriculture and small businesses was about 1.47 trillion yuan. In the fourth quarter of this year, an additional 300 billion yuan of small reloans will be added to improve the credit supply capacity of small and medium-sized banks; It can be seen that lowering the interest rates for refinancing support for agriculture and small businesses will help reduce the cost of funds for small and medium-sized banks, thereby guiding small and medium-sized banks to reduce loan interest rates for “agriculture, rural areas and farmers” and small and micro enterprises, and better leverage the monetary policy of “precise drip irrigation” and “direct delivery”. The role of “entity”.
Can the lowering of the refinancing interest rate for supporting agriculture and small businesses be regarded as an “interest rate cut” in the policy interest rate? Zhang Xu said that my country’s central bank policy interest rate system consists of open market operating interest rates (short-term policy interest rates) and medium-term lending convenience interest rates (medium-term policy interest rates). Relending and rediscounting interest rates are not policy interest rates. In the current monetary policy transmission mechanism, the central bank mainly releases interest rate control signals through policy interest rates such as medium-term lending facilitation (MLF) and open market reverse repurchase, and guides market benchmark interest rates such as DR007 to operate with the policy interest rate as the center, which ultimately affects loans, etc. Interest rates of financial products. Among them, the MLF interest rate is not only the interest rate of the central bank’s operating tool, but also the operating goal of monetary policy, and it is also a component of the loan market quoted interest rate (LPR). Therefore, when observing the policy orientation, we should first pay attention to whether the interest rate has changed, not the re-lending rate.
Wang Qing believes that the current downward adjustment of the reloan interest rate for supporting agriculture and small businesses is a directional force of structural monetary policy. The market impact is relatively limited and will not drive market interest rates down sharply. In the short term, it does not mean that the central bank’s 7-day reversal period will be reversed. The policy interest rate represented by the purchase interest rate and the MLF interest rate will be reduced accordingly. However, under the cumulative effect of the central bank’s successive RRR cuts, December LPR quotations may be slightly lowered by 5 basis points. This will directly drive down the loan interest rates of various enterprises and reverse the marginal rise of general loan interest rates in the third quarter.
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