Following the central bank's simultaneous interest rate and reserve requirement cuts on June 28, 2015, the central bank once again announced on the evening of August 25 that it would lower the benchmark deposit and loan interest rates and the deposit reserve ratio starting from August 26, 2015. , this is the fourth time the central bank has cut interest rates and the fourth time it has cut reserve requirements in 2015.
Among them, the one-year loan benchmark interest rate of financial institutions was reduced by 0.25 percentage points to 4.6%; the one-year deposit benchmark interest rate was reduced by 0.25 percentage points to 1.75%; other loan and deposit benchmark interest rates, personal housing Provident fund deposit and loan interest rates will be adjusted accordingly.
The reduction in loan interest rates means a reduction in the repayment burden. After this adjustment, the interest rate for mortgage loans with a term of more than 5 years is reduced to 5.15%, and the interest rate for personal housing provident fund loans with a term of more than 5 years is 3.25%. 1. What are the main considerations behind the introduction of combined measures such as interest rate cuts and reserve requirement ratio cuts?
Answer: At present, there is still downward pressure on my country's economic growth. The tasks of stabilizing growth, adjusting structure, promoting reform, benefiting people's livelihood, and preventing risks are still very arduous. The global financial market has also experienced large fluctuations recently. It is necessary to use monetary policy tools more flexibly to create a good monetary and financial environment for economic structural adjustment and stable and healthy economic development.
The main purpose of lowering the benchmark interest rates for loans and deposits this time is to continue to play a good role in guiding the benchmark interest rates, promote the reduction of social financing costs, and support the sustained and healthy development of the real economy. Since November 2014, the People's Bank of China has lowered the benchmark interest rates for loans and deposits four times, guiding financial institutions' loan interest rates to continue to decline. In July 2015, the weighted average loan interest rate of financial institutions was 5.97%, falling below 6% for the first time since 2011. The problem of high social financing costs has been effectively alleviated. Although the CPI has rebounded slightly in the past two months, it is mainly due to structural factors such as the significant increase in pork prices. The overall price level is still at a historically low level, which also provides conditions for the re-use of price tools to further reduce social financing costs. To this end, with the approval of the State Council, the People's Bank of China decided to further lower the benchmark interest rates for loans and deposits, promote the continued decline of loan interest rates of financial institutions and various market interest rates, and consolidate the policy effects of early macro-control.
This reduction in the deposit reserve ratio is mainly to provide long-term liquidity appropriately based on changes in liquidity in the banking system, so as to maintain reasonable and sufficient liquidity and promote stable and healthy economic development. The People's Bank of China has recently improved the quotation mechanism for the central parity rate of the RMB against the US dollar, and has corrected the spread between the past central parity rate and the market exchange rate. As the foreign exchange market approaches equilibrium, it will also cause fluctuations in liquidity, which needs to be compensated accordingly. The resulting liquidity gap and lowering the deposit reserve ratio can play such a role. In addition, this time the deposit reserve ratio of county rural commercial banks, rural cooperative banks, rural credit cooperatives, village banks, financial leasing companies, and automobile finance companies will be additionally reduced. This is mainly to guide relevant financial institutions to further increase their investment in "agriculture, rural areas and farmers". ", small and micro enterprises and support for expanding consumption.
2. What is the background and significance of this loosening of the floating cap on interest rates for time deposits with a maturity of more than one year in conjunction with the interest rate cut? Why should we continue to keep the floating upper limit on the interest rates of time deposits and demand deposits with a maturity of less than one year unchanged?
Answer: In accordance with the strategic arrangements of the Party Central Committee and the State Council, in recent years, the People's Bank of China has accelerated the market-oriented reform of interest rates and made important progress. At present, interest rate controls except for deposits have been fully liberalized. The upper limit of the floating limit of deposit interest rates has been expanded to 1.5 times the benchmark interest rate. Large-denomination certificates of deposits for enterprises and individuals have been officially issued. The self-discipline mechanism for market interest rate pricing has been continuously improved. The central bank's interest rate control capabilities have gradually improved. The deposit insurance system has been strengthened and the deposit insurance system has been successfully launched, and the conditions for further promoting the market-oriented reform of interest rates have become more mature. At the same time, my country's current price level is generally at a low level, the total liquidity of the banking system is abundant, and the upward pressure on market interest rates is relatively small, which also provides a good macro environment and time window for promoting the market-oriented reform of interest rates.
Under this circumstance, integrating reform into regulation, further promoting interest rate market-oriented reform in conjunction with interest rate cuts, and releasing the upper limit of floating interest rates on time deposits with maturities of more than one year mark that my country's interest rate market-oriented reform has moved forward. An important step has been taken.
With the further expansion of the independent pricing space of financial institutions, it will not only help financial institutions improve their independent pricing capabilities, accelerate the transformation of business models, and improve financial service levels, but also help promote fund prices to more truly reflect the market supply and demand relationship and give full play to the market. It plays a decisive role in further optimizing resource allocation, promoting economic structural adjustment, transformation and upgrading, and creating good conditions for healthy and sustainable economic and financial development.
This time, the upper limit of the floating interest rate of time deposits and demand deposits with a maturity of less than one year remains unchanged, which reflects the reform idea of ??gradually liberalizing the upper limit of deposit interest rates in accordance with the basic sequence of "first long-term, then short-term". It is also consistent with common international practice. Judging from international experience, advancing the interest rate marketization reform in this order will help cultivate and exercise the independent pricing capabilities of financial institutions, laying a more solid foundation for the eventual full realization of interest rate marketization; it will also help stabilize the deposit interest payments of financial institutions. rate and overall financing costs, and promote the reduction of social financing costs, which is of positive significance for maintaining sustained and healthy economic development.
3. After the floating cap on interest rates for time deposits with a maturity of more than one year is lifted, how to guide financial institutions to set scientific and reasonable prices?
Answer: After lifting the upper limit on the floating interest rate of time deposits with a maturity of more than one year, the People's Bank of China will continue to improve relevant supporting measures, further guide financial institutions to set scientific and reasonable prices, and maintain a fair and orderly market competition order. The first is to continue to announce the deposit benchmark interest rate according to the existing maturity grades. The guiding role of benchmark interest rates will be further brought into play to provide important reference for financial institutions in pricing time deposit interest rates with maturities of more than one year. The second is to improve the interest rate control and transmission mechanism. Further improve the central bank's interest rate control system and enhance its ability to control interest rates. Strengthen the cultivation of benchmark interest rates in the financial market, improve the market interest rate system, and improve the efficiency of monetary policy transmission. The third is to give full play to the role of industry self-discipline management. Guide the self-regulatory mechanism for market interest rate pricing and further give full play to the important role of industry pricing self-discipline. In accordance with the principles of legal compliance, incentives and constraints, financial institutions with better interest rate pricing will continue to be given priority to grant more market pricing rights and product innovation rights. Expand the scope of investment in large-denomination certificates of deposit issuers and interbank certificates of deposit; impose necessary self-discipline on financial institutions whose deposit interest rates exceed reasonable levels and disrupt market order.
4. What are the recent central bank operations to provide liquidity?
Answer: The central bank has many channels and tools to provide liquidity. In addition to lowering the required reserve ratio, the central bank has also recently implemented expanded reverse repos, medium-term lending facilities (MLF), collateralized supplementary loans (PSL), etc. Market liquidity and loanable funds initiatives. Since August, a total of 565 billion yuan of liquidity has been carried out through reverse repurchase operations, and a total of 60 billion yuan has been provided through time deposit operations of central treasury cash management commercial banks. On August 19, a 6-month MLF operation of 110 billion yuan was carried out with an interest rate of 3.35%. While increasing market liquidity, it also guided financial institutions to increase their investment in key areas and weak links of the national economy such as small and micro enterprises and "agriculture, rural areas and farmers". Strength of support. We will continue to use PSL to provide a long-term, stable and cost-appropriate source of funds for development finance to support housing reform. The PSL balance at the end of July was 846.4 billion yuan, an increase of 463.3 billion yuan from the beginning of the year. In order to give full play to the role of price leverage in a timely manner and adapt to adjustments in the benchmark interest rates for deposits and loans, the PSL funding interest rate has been lowered three times this year to increase support for the renovation of shantytowns and promote the reduction of financing costs. In addition, the central bank continues to support financial institutions to increase credit extension to "agriculture, rural areas and farmers" and small and micro enterprises through supporting agriculture, supporting small businesses, refinancing, and rediscounting. At the end of July, the balance of re-loans to support agriculture was 213.9 billion yuan, an increase of 26.2 billion yuan from the same period last year; the balance of re-loans to support small businesses was 62.5 billion yuan, an increase of 25.4 billion yuan from the same period last year; the balance of rediscounts was 127.2 billion yuan, an increase of 26.2 billion yuan from the same period last year. An increase of 11.8 billion yuan.
In the next step, the central bank will continue to closely monitor changes in liquidity, use a combination of various tools to appropriately adjust liquidity, maintain reasonably sufficient liquidity and the stable operation of the money market, guide the steady and moderate growth of money and credit, and promote the economy. Stable and healthy development. Judging from the analysis tool of Big Data Magic Mirror, for home buyers who use commercial loans, after this interest rate adjustment, according to the commercial loan of 1 million yuan and 20 years of equal principal and interest repayment method, if the interest rate is reduced according to the benchmark interest rate, the monthly The supply will be reduced by 139.82 yuan, and the annual burden can be reduced by 1,677.84 yuan.
For buyers who take housing provident fund loans, after this interest rate adjustment, according to the housing provident fund loan of 1 million yuan, 20 years of equal principal and interest repayment method, if the interest rate is reduced according to the benchmark interest rate, the monthly payment will be With a reduction of 127.64 yuan, the annual burden can be reduced by 1,531.68 yuan.
For buyers who use provident fund and commercial mixed loans, if after this interest rate adjustment, according to the provident fund and commercial loans of 500,000 yuan each, 20 years of equal principal and interest repayment method, after the interest rate reduction, if according to Based on the base interest rate, the monthly payment will be reduced by 133.73 yuan, and the annual burden can be reduced by 1,604.76 yuan.