UOB Group’s Economist Lee Sue Ann suggests the PBoC might reduce its policy rate at its gathering later in the month.

Key Quotes

“With the less optimistic outlook for the Chinese economy and measured pace of monetary policy easing so far, the 1Y LPR could continue to move lower to 3.55% by end-4Q22, instead of our earlier expectation that the monetary easing would cease by end-3Q22.”

“After 35bps cut YTD, the 5Y rate is still poised to fall further as PBoC extends support to the property market.”