Loans in China Getting Rolled Over
It is believed that China’s central bank will extend medium-term loans due this week. However, a survey by Reuters revealed that another push back is probably not on the cards.
The majority of surveyed financial organizations stated that they anticipate the PBOC (People’s Bank of China) will be providing a sum equivalent to $31.45 billion USD for its medium-term loan facility.
As a hint towards the PBOC’s loosening approach, the few unconvinced institutions stated that they believe there will be an amount marginally higher than the total of loans coming due. What’s more, the participants of the survey said that they think the MLF rate would stay still.
Capital Markets React to Ukraine War Possibility
A market panic over the possibility of Russia invading Ukraine was recently sparked by comments made by American officials. Numerous markets have seen a reduction in risk and equities are down.
The Asia Pacific’s major exchanges were down between 1% and 2%. Australia was an outlier however, with its energy and gold stocks driving ASX 200. Over in Europe, the Stoxx 600 dropped 2.5%.
After briefly appearing above 2 percent a few days ago, the US 10-year Treasury yield is now close to 1.92%.
After soaring close to $1865, gold is now consolidating. Oil was rising at one point too, with the March WTI contract reaching nearly $95 prior to stabilizing.
China’s Central Bank to Sustain Liquidity
China’s central bank stated last week that it will work to maintain reasonable liquidity while increasing financial support for important industries. It also plans to support weaker parts of the economy.
According to a fourth-quarter report, the People’s Bank of China said that it will meet reasonable needs of the real economy without resorting to a tide of new stimuli.
Despite quickly bouncing back from the COVID-19 downturn, some are worried about both the emergence of Omicron and the state of property developers.