China’s Rate Cut Decision Sparks Pessimism Over Economic Growth Amid Banking Stability Concerns
– Citigroup downgrades annual growth forecast to 4.7% due to China’s actions.
– One-year loan prime rate cut by 0.10 percentage points to 3.45%.
– Five-year rate, which impacts mortgage lending, remains steady at 4.2%.
– Economists expected 0.15 percentage point cuts to both rates.
– China’s growth forecast failing to hit official target of “about 5%”.
– Dilemma for Beijing: stimulate economy while preserving banking stability.
– Concerns over liquidity crisis among property developers impacting trust industry.
– Weak property sector, declining exports, and youth unemployment hampering growth.
– Chinese banks report slowing profits in the first half of 2023.
