tes. But space and highways, ports and power generation road further investment has been relatively limited.In the development of the inland regions, promote urbanization and improvement of public services and other areas, the government can also increase the intensity of the underlying investments, which may include a focus on the development and transportation projects, urban and rural public facilities and services in the western region, as well as shanty towns transformation. To support such investments, the government has been, and may continuenike air max 90 hyperfuse uk
to innovative financing mechanisms, including the role of policy-oriented financial institutions, businesses and attract private sector investment, as well as further deregulation.The release of a new growth engine through reformAfter the Asian financial crisis, the domestic reforms (especially in the urban housing market reform) and the global economic recovery has helped China's economic success out of trouble. This time, however, difficult to expect a strong recovery in global demand, but the decision-makers are trying to accelerate reforms to release a new growth engine.We expect the decision-makers will focus on promoting pro-growth reforms to help the following measures: Reduce market access barriers, decentralization (especially for private enterprises in the service sector), thus contributing to enterprises, especially private sector investment; Public service reform: liberalization of private sector investment, operating traditional public services, including utilities, transportation and health care, etc., you can take the "public-private partnerships" (PPP), etc.; Tax (VAT reform, small and micro enterprises tax relief, reduce administrative costs and
surcharges, etc.); The social security system reform - to continue to expand the coverage of the pension and social security, improving payment rates; Expedite the implementation of four-tier cities hukou reform.Monetary easing creditRelax Mobility: This year, the People's Bank does not fully reduce the reserve ratio, but the use of re-lending, permanent loan facilities (SLF), open market operations, foreign exchange market intervention, and directed a series of quasi-drop policy tools. On the one hand, the central bank may not want to pasnike air max 1 womens
s too strong policy easing signal, on the other hand, the central bank may consider a higher RRR environment easier to fine-tune liquidity. According to reports, the recent central bank is preparing to launch the new monetary policy instruments (mortgage supplemental loan, PSL). In addition, if sustained massive outflow of foreign exchange, the central bank may eventually cut the current high RRR.Relax credit restrictions: China Banking Regulatory Commission recently relaxed the loan to deposit ratio of diameter (widely considered the loan to deposit ratio is currently one of the main factors restricting bank lending). To loosen credit conditions, the future decision-makers may be more similar to the counter-cyclical macro-prudential management, including relaxing lending restrictions on certain industries, raising the loan limit, advancing credit asset securitization. Moreover, with the local government financing platforms and large scale enterprises to expand the bond issue, which may also give small
businesses and private enterprises to obtain bank loans to free up space. In addition, policy banks may also increase further.Reduce financing costs: ample liquidity in recent months to make short-term inter-bank market interest rates remain low (Figure 5 & 6), which promotes corporate bond issuance, and help drive down the straight stick and reprint commercial paper rate (which is a lot of private sector The short-run marginal financing costs). However, most of the credit price is still below the benchmark lending rate, which has not changed. Since the CPI and inflation expectations continue to fall, real interest rates rise. In this case, in order to reduce financing costs, the government has the followingnike air max 2014 uk
options: The central bank may cut its benchmark interest rate - despite the recent interest rate market has made some progress, but most of the credit was still the benchmark pricing standards. However, in order to promote market-oriented reforms, and feared that the policy rate cut signals the release of relaxing too strong, the central bank may not take this measure in the short term. Accordance with the existing deployment, the government can clean up unnecessary funds "channel", "bridge" links, reducing financing chain. This means that the demand for credit by the more general bank loans, government and corporate bonds to be met, and economic dependence on the shadow of credit will be reduced. Furthermore, we expect the government will continue to encourage increased foreign borrowing banks and big business take advantage of lower borrowing costs abroad. For small businesses, the government can reduce its financing costs by explicitly guarantees or interest subsidy, rather than directly require banks to lower