The central bank decided to lower the benchmark interest rates for deposits and loans of financial institutions in RMB starting from July 6. The benchmark one-year deposit interest rate of financial institutions was reduced by 0.25 percentage point, and the benchmark one-year loan interest rate was reduced by 0.31 percentage point.
I remember that when we first stepped into July, the central bank sent out a policy signal of prudent monetary policy to support the real economy. The asymmetric adjustment of deposit and loan interest rates that had been clamoring before was finally promulgated today.
The pressure of the half-year bank deposit-loan ratio test has passed. This interest rate adjustment has attracted deposits from depositors and boosted the confidence of enterprises in loan development. Yang Delong, chief strategist of the South China Fund, an economist, believes that this interest rate cut is a "timely rain" for the market to curb the rapid decline in economic growth.
The author believes that the central bank cut interest rates for two consecutive months, and the cumulative effect is gradually manifesting; in the second half of this year, steel, as a capital-intensive industry, will gradually eliminate the long-lasting decline in the industry and usher in the spring of development.
Monetary policy supports the real economy
The pressure of the bank’s half-year deposit-loan ratio test has passed. The continuous interest rate adjustment policy will clearly indicate that the country has entered an interest rate cut cycle. The public is more sensitive to the rumors that the CPI will break 3% in June, because the current one-year deposit interest rate is still 3%, which is still very Attractive. In addition, the 6% one-year loan interest rate dropped by 0.31% at once, which is 0.06% more than the previous symmetrical reduction of 0.25%. This reduces operating costs for development companies that rely heavily on capital. Also intensified efforts to reduce the burden.
The downstream of the steel industry, such as terminal manufacturing, is a typical real economy, and they need to purchase steel as raw materials. This reflects that it is a capital-intensive enterprise.
The Pearl River Delta region is an area where home appliances are intensively manufactured. Some time ago, companies have ushered in the policy support of "home appliances to the countryside". The coming of this interest rate cut cycle will undoubtedly create a double benefit for it.
In terms of automobile manufacturing, due to the rapid development of urbanization, taking into account the pressure of traffic and the pressure of environmental air pollution, Guangzhou issued a household restriction order for small and medium passenger cars earlier this month, which cast a shadow over the development of the automobile industry. The arrival of this intensive interest rate cut cycle will reduce the burden of capital occupation costs for companies with greater inventory pressure.
In addition, the steel trade industry is in the midstream of steel production, and inventory pressure is also obvious. The interest rate cut this time has benefited itself and the downstream industries. It can be described as killing two birds with one stone.
Policy effects are difficult to reverse in the short-term
Due to the obvious decline in economic development at home and abroad, the prices of domestic commodities have continued to fall recently, and the prices of coal, petroleum, and steel have all shown a weakening trend.
The apparent decline in crude oil prices in Brent and New York once made people imagine that domestic refined oil prices might fall again in July. Among them, New York crude oil prices fell below $80/barrel in late June, but then due to the escalation of tensions in Iran, international oil prices rebounded rapidly.
Due to the sharp drop in coal prices, the profit growth of the coal industry has plunged. From January to May, the profit of Shanxi's coal industry was 40.08 billion yuan, an increase of 3.2% year-on-year, and a decrease of 33.6 percentage points from the same period last year. The five major coal groups in Shanxi rarely experienced negative earnings growth. The current coal market is very sad, and the major coal provinces are very lost.
In the steel industry, steel prices have been in a downward trend since they began to slowly decline in mid-April. The 1500 hot-rolled plain carbon steel coil in the Shanghai area has dropped from 4360 yuan/ton to the current 4,080 yuan/ton; the 1.0-2.0mm cold-rolled plain carbon steel coil in the Lecong area of ??Foshan has been reduced from 5010 yuan/ton to the current 4620 yuan/ton; The 25mm three-level thread in Guangzhou area dropped from 4440 yuan/ton to 4130 yuan/ton.