1 May 2015
Unconventional policy measure in China could be on the table – BBH
FXStreet (Barcelona) - The Brown Brothers Harriman Team, sees further easing potential in China, but not a weak Yuan policy.
Key Quotes
“Although press reports were later denied, it was still enough to reinforce the view that there is still a lot more easing to come. We think China still has a lot of conventional easing tools at its disposal, so even if QE is being discussed, we doubt it is imminent.”
“That said, we recognize that China is looking to find way to expand the monetary base in light of less liquidity injected from diminished sterilization operations.”
“We do not see a weak yuan policy in place, as PBOC fixed USD/CNY at its lowest level since mid-December.”
Key Quotes
“Although press reports were later denied, it was still enough to reinforce the view that there is still a lot more easing to come. We think China still has a lot of conventional easing tools at its disposal, so even if QE is being discussed, we doubt it is imminent.”
“That said, we recognize that China is looking to find way to expand the monetary base in light of less liquidity injected from diminished sterilization operations.”
“We do not see a weak yuan policy in place, as PBOC fixed USD/CNY at its lowest level since mid-December.”