Lowering the loan interest rate can stimulate economic growth. But the problem here is that if we only lower the loan interest rate, the bank's interest margin income will decrease, which is a great test for the banking industry. Therefore, the policy needs to find a balance point. In the future, we should tend to increase liquidity to the market by lowering the deposit reserve ratio. In fact, it refers to the interest rate in the interbank lending market, and the most important thing is the overnight lending rate. For example, when the economy is overheated, the central bank should raise the benchmark of inter-bank loan interest rate in time, control the inflation rate, and prevent its purchasing power from being eroded in the process of rising prices. When the economic development slows down, the central bank will lower interest rates, reduce the cost of loans to a certain extent, appropriately encourage social investment and stimulate consumption. Reduce loan interest rates, support social loans, provide enterprises with funds with low financing costs, and encourage the expansion of production.
Reduce deposit interest rate, reduce savings income, encourage investment and expand consumption. But in practice, it is mainly the loan interest rate. For example, the interest rate adjustment of 6543810.7 on October 7 only reduced the loan interest rate by 0.27 percentage point, and reduced the deposit reserve ratio. This shows that the national loan is loose and the bank interest paid by the loan is less. This time, the deposit interest was not reduced, and the income tax on deposit interest was cancelled. Ordinary banks are first managed by the central bank. In addition, the central bank has the highest power in the money market, and can issue money, adjust deposit and loan interest rates, and adjust the deposit reserve ratio. These rights of the central bank directly affect banks and even the whole financial industry, and then affect the whole social and economic development. Secondly, answer your question directly.
Banks cut interest rates mainly to reduce the interest on deposits or loans. Generally speaking, it falls together. Why do they fall together? Because the main income of banks is interest margin, unilaterally reducing deposits or loans will either affect the income of banks or harm the interests of depositors. Generally, interest rates will be cut together or reduced together. Under special circumstances, the interest on deposits or loans will be reduced unilaterally, depending on the purpose of the central bank. For example, if you want to promote consumption, you will lower the loan interest. If you want to promote the development of the enterprise, you will also reduce the loan interest. To control consumption and production, it is necessary to increase loan interest and make money more expensive. Generally speaking, under the downward pressure of the economy, economic stimulus measures are taken. General deposit and loan interest rates will be reduced, and deposit interest rates will be relatively stable. The loan interest rate will fluctuate due to the influence of market communication. It is easy for enterprises to expand investment and reproduction, and reducing interest rates will reduce profitability, but it is easy to increase corporate debt. Therefore, enterprises should control the financing scale and investment in a suitable range.