China's central bank could cut its benchmark policy rate for the first time...
SHANGHAI - China’s central bank could cut its benchmark policy rate for the first time in four years if the U.S. Federal Reserve delivers a widely expected cut in late July, analysts say, as Chinese policymakers step up support for the slowing economy.
While Chinese officials continue to downplay the likelihood of more aggressive easing, the economy has been slow to respond to a host of earlier stimulus measures, while the U.S.-China trade war is growing longer and costlier. “The current monetary policy transmission mechanism is jammed, and the impact of quantitative regulations is therefore limited,” said Ming Ming, head of fixed income research at CITIC Securities in Beijing.Markets have priced in a 25 basis-point cut to U.S. interest rates when the Fed holds its next policy meeting on July 30-31, and expect several more later this year and next as the U.S. economy cools.
In recent weeks it has also stepped up cash injections to calm market nerves after regulators seized a troubled bank, which sparked worries of financial contagion.
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