China: PBoC could ease further its monetary conditions – UOB

Lee Sue Ann, Economist at UOB Group, suggests the PBoC could reduce the Loan Prime Rate (LPR) at its next meeting on March 20.

Key Quotes

“With the need for further support measures toward the real economy and for 5Y loan prime rate (LPR) to fall further to boost demand for homes, we see the possibility for the 1Y LPR to fall to 3.55% and 5Y LPR to 4.20% in Mar, following the National People’s Congress (NPC).”

“The loosening bias for the monetary policy may start to reverse in 2H23, though, should the economy show stronger rebound and inflation quickens.”