On August 20, the central bank authorized the National Interbank Lending Center to announce that the loan market quoted interest rate (LPR) is: 1-year LPR is 3.35%, and 5-year and above LPR is 3.85%. The two-phase LPR was the same as last month. So why did LPR "stand still" in Au

lpr?

will remain unchanged for August lpr, which industry experts had expected.

Zhou Maohua, a researcher at the Macro Market Department of Everbright Bank , believes that the LPR interest rate is expected to remain stable in August. Judging from the current weak domestic capital demand relative to supply, there is still some pressure to lower LPR interest rates, but it also faces resistance.

To understand the factors of LPR adjustment, you first need to understand the intensity and current level of LPR adjustment during the year.

In the first half of this year, lpr quotations experienced two major adjustments. In February this year, the LPR over 5 years fell from 4.20% to 3.95%, a significant decrease of 25 basis points; in July, the LPR over 1 year was 3.35%, and the LPR over 5 years was 3.85%, with the two periods of LPR falling symmetrically by 10 basis points. base point. Judging from LPRs with maturities of more than 5 years, the decline during the first 7 months has reached 35 basis points.

Based on the above changes, mortgage interest rates and real economy financing costs continue to hit record lows, and the effects of policies continue to be released.

Currently, where is the pressure to lower LPR interest rates?

Judging from the currently released social financing data for the year, there is an indisputable fact: in the first half of the year, physical financing demand was weak and credit growth slowed down.

In this regard, the relevant formulations of the "2024 Second Quarter Monetary Policy Implementation Report" (hereinafter referred to as the "Report") released by the central bank on August 9 are worthy of attention. The "Report" puts credit before bonds in "reasonably grasping the relationship between credit and the two largest financing markets of bonds and ", and adds requirements such as "deeply exploring effective credit needs and accelerating the transformation of reserve projects".

At the same time, the "Report" also mentioned promoting the replacement of old consumer goods with new ones to help release consumption potential. This is consistent with the requirements put forward by the Politburo meeting to expand domestic demand and promote consumption.

Next, where is the resistance to lowering the LPR interest rate?

In fact, on the one hand, the reduction of loan interest rates needs to consider reducing the burden on the people and the financing needs of the real economy. On the other hand, the operational stability of financial institutions cannot be ignored. Commercial banksNet interest margin and stable operating profits are also one of the important considerations.

Zhou Maohua said that some banks are still facing significant narrowing of net interest margins and operating pressures.

lpr interest rates are expected to continue to decrease

Previously, the latest lpr announced every month and the open market operation interest rate were important reference indicators. The open market operation interest rate here mainly refers to the MLF (medium-term lending facility).

Since the central bank promoted the market-oriented reform of loan interest rates in August 2019, the LPR quotation is determined by the MLF operating interest rate and the quotation plus points (that is, LPR = MLF interest rate + spread), where the MLF interest rate serves as the anchor interest rate for the LPR quotation, and its changes It will have a direct and effective impact on lpr.

However, the status of mlf interest rate as a policy interest rate is being further diluted.

It is obvious that on August 15th, the central bank made it clear that the MLF that expired on that day will be renewed on August 26th, and the LPR quotation will be announced before the MLF.

In this regard, Minsheng Bank chief economist Wen Bin believes that by postponing the MLF renewal time to after the LPR quotation time, the policy interest rate attribute of the MLF interest rate is further weakened, and the 7-day repurchase operation interest rate is further strengthened as a The main policy interest rates will gradually clear up the short-term and long-term interest rate transmission relationship, and continue to promote financial institutions to improve their independent pricing capabilities.

Cinda Securities fixed income team said that last week the central bank’s net investment in the open market reached 1.52361 billion yuan. The central bank has basically fully hedged the disturbance of exogenous factors, so the funding level remains stable.

Overall, the central bank will continue to deepen the lpr reform, improve the quality of its quotations, ensure the smooth flow of interest rate transmission channels, and create favorable conditions for the stable recovery and high-quality development of the economy.

Market predictions indicate that there is a high probability that interest rates will be cut during the year, which will continue to drive down LPR interest rates and reduce the financing costs of the real economy. September is an important observation window.

international trends are worthy of attention.

’s prediction of lpr’s future trend needs to be observed in conjunction with domestic and foreign trends.

Internationally, many countries or regions will release important economic data this week:

◎On the 20th, the European Union announced the Eurozone cpi data for July;

◎On the 21st, the U.S. Energy Information Administration (EIA) released its weekly energy report;

◎On the 22nd, the European Union announced the Eurozone manufacturing PMI in August, the United States announced the number of initial jobless claims on August 17, and the Federal Reserve will release the minutes of the August monetary policy meeting;

◎On the 23rd, the United States will announce new housing prices in July Sales seasonally adjusted data.

The latest meeting minutes to be released by the Federal Reserve and the European Central Bank will have a profound impact on the global market, including the direction of the US dollar and interest rate fluctuations.

What needs special attention is the annual meeting of global central banks.

After experiencing a panic plunge in early August, the United States, Europe, Japan, South Korea and other markets showed a clear rebound last week, and some stock indexes almost recovered their losses. Compared with the rebound in the stock market, the price of gold hit a record high again.

Looking forward to the market outlook, the global financial circle is paying attention to this week's major event - the upcoming Jackson Hole Global Central Bank Annual Meeting from August 22 to 24, Eastern Time.

The theme of this year’s global central bank annual meeting is “Reevaluating the effectiveness and transmission mechanism of monetary policy.” It is reported that Federal Reserve Chairman Powell will deliver a keynote speech at 10 a.m. Eastern Time on August 23 (22:00 Beijing time on Friday).

The industry believes that the amount of information in this speech is quite critical and will give the latest clues to monetary policy.

Source: Popular News