**10,000 Fans Incentive Plan
The closely watched LPR (Loan Market ** Rate) for February has been released, and this time the data has once again significantly exceeded market expectations.
According to the data released on the morning of the 20th, the 1-year LPR remained at 3 in the loan market** interest rate in February45% level, the same as the previous period; The LPR with a maturity of more than 5 years has been significantly lowered, from 4 in the previous period2% to 395%, down 25 basis points. This drop far exceeded market expectations and was the largest adjustment since the LPR reform in August 2019.
What does this larger-than-expected "rate cut" mean?
Convey the signal to promote the stable development of the real estate market
Dong Ximiao, chief researcher of Zhaolian, pointed out that the sharp reduction of LPR for more than 5 years far exceeded market expectations, sending a strong signal to boost residents' housing consumption and promote the steady development of the real estate market. With the decline in mortgage interest rates, residents' mortgage spending will decrease, which will help boost the willingness and ability of housing consumption. In addition, for medium and long-term loans to enterprises and institutions, the decline in interest rates will also stimulate their financing demand and provide more support for major national projects and infrastructure construction.
Boost confidence in economic recovery
Reducing financing costs has always been the central bank's policy direction. The "interest rate cut" is also believed by industry insiders to have played an important role in boosting confidence in economic recovery. Zhou Maohua, a macro researcher at the financial market department of Everbright Bank, said that this measure will help stimulate the vitality of the real economy, help the recovery of real estate, and accelerate the recovery of consumption and domestic demand. Dong Ximiao also believes that the reduction of medium and long-term loan interest rates for enterprises and institutions will further stimulate their financing needs and provide support for the sustained recovery of the economy.
Deposit rates and lending rates are likely to be further reduced
Looking ahead, many analysts believe that there is still room for both lending rates and deposit rates to fall. According to the data of the central bank, continuing to deepen the market-oriented reform of interest rates is an important direction in the future. Therefore, in the future, it is likely to continue to promote the reform of deposit rates and further reduce the cost of banks' liabilities to ease the pressure on banks' net interest margins. Both the policy rate and the market interest rate are likely to continue to fall, creating a more favorable financial environment for the development of the real economy.
Conclusion:
The central bank's larger-than-expected move to cut interest rates sends a positive signal for the real estate market and economic recovery. In the future, with the possible further reduction of deposit interest rates and loan interest rates, China's economy will usher in a more stable development environment.