Comments from People’s Bank of China's Lu (via MNI)

  • Monetary easing to add capital outflow pressure
  • Room for monetary policy is relatively small
  • Rate/RRR cut to fuel financial risk accumulation
  • Easing monetary condition to boost leverage ratio

More:

  • Sees increasing risks with corporate debt
  • Deflation pressure to rise in 2016
  • Sees 2016 gdp at around 6.5%, forecasts CPI around 1.3%
  • 2016 M2/Total social financing growth between 11-13%
  • Yuan exchange rate volatility to rise in 2016

--

Lu Lei is head of the PBOC's Research Bureau

-

The PBOC have been telling us repeatedly that the OMOs they are conducting are instead of a rate/RRR cut. More of the same from Lu here in these comments.