At 9:00 a.m. on May 7, the State Council Information Office held a press conference, where the heads of the People's Bank of China, the State Financial Supervision and Administration Bureau, the China Securities Regulatory Commission and other departments jointly appeared to introduce the relevant situation of "a package of financial policies to support stabilizing the market and expectations." Behind the positive signal from the policy side is a precise response to the current complex economic environment.
Pan Gongsheng, governor of the People's Bank of China, made it clear at the meeting that in order to implement the spirit of the Political Bureau of the Central Committee meeting on April 25 and promote high-quality economic development, the People's Bank of China will increase its macro-control efforts, introduce a package of monetary policy tools, and further improve the "quantity, price, and structure" three-in-one control framework.
This "policy package" that has attracted much attention from the outside world covers multi-dimensional measures such as reserve requirement ratio cuts, interest rate cuts, and targeted support, with a total of ten core measures:
1. Quantitative policy: releasing long-term liquidity and stabilizing the “water level”
1️⃣ Reduce the reserve requirement ratio by 0.5 percentage points across the board
It is expected that about 1 trillion yuan of long-term liquidity will be released into the market to "replenish" the real economy, strengthen credit support, and reduce bank funding costs.
2️⃣ Optimize the deposit reserve system
The deposit reserve ratio of automobile finance companies and financial leasing companies will be temporarily reduced from the current 5% to 0%, further unleashing the financial vitality of the industry and supporting areas such as consumer finance and equipment leasing.
2. Price-based policy: reducing financing costs and stimulating credit demand
3️⃣ Reduce the policy interest rate by 0.1 percentage point
The 7-day reverse repurchase rate in the open market was reduced from 1.5% to 1.4%, and the loan market benchmark rate (LPR) was simultaneously guided downward to alleviate the financing pressure on enterprises.
4️⃣ Reduce the interest rate of structural policy tools by 0.25 percentage points
The interest rates for special re-loans and re-loans for supporting agriculture and small businesses were reduced from 1.75% to 1.5%, and the interest rate for mortgage supplementary loans (PSL) was reduced from 2.25% to 2%, reducing the cost of using special funds in key areas.
5️⃣ The interest rate of individual housing provident fund loans was reduced by 0.25 percentage points
The interest rate for housing provident fund loans for the first home with a term of more than five years has been reduced from 2.85% to 2.6%, and the interest rate for other terms has been reduced simultaneously, further supporting the purchase of homes for basic needs and promoting the stable development of the real estate market.
III. Structural policies: precise drip irrigation and strengthening key support
6️⃣ Increase the re-lending quota for scientific and technological innovation and technological transformation by RMB 300 billion
The total amount of re-lending has been expanded from 500 billion yuan to 800 billion yuan, strengthening financing guarantees for the "two new" fields (new infrastructure and new technologies) and promoting corporate technological upgrading.
7️⃣ Add 500 billion yuan of "service consumption and pension re-loans"
Focus on demand-side areas such as elderly care and service consumption, and expand consumption potential through precise support through financial tools.
8️⃣ Increase the re-lending quota for supporting agriculture and small businesses by RMB 300 billion
Together with the interest rate cut, this will form a "combination punch" to further expand loan coverage for rural areas, private enterprises and small and micro enterprises, and help rural revitalization.
9️⃣ Optimize capital market liquidity support tools
The 500 billion yuan securities, fund and insurance company swap facility and the 300 billion yuan stock repurchase and shareholding re-loan will be merged into a total amount of 800 billion yuan to more flexibly support the liquidity needs of the capital market.
🔟 Innovative technology innovation bond risk sharing tool
The central bank will provide low-cost re-lending funds and encourage banks, local governments, and credit enhancement institutions to reduce the issuance risks of science and technology innovation bonds through joint guarantees and risk sharing, and support innovative enterprises in obtaining low-cost, long-term financing.
Pan Gongsheng emphasized that this package of policies will ensure reasonable liquidity and reduce financing costs through the "total amount + structure" approach, while targeting key areas and strengthening financial support for "key, weak, and strategic" links such as scientific and technological innovation, consumption, private enterprises, and small and micro enterprises.
Policy interpretation: Funding easing and structural adjustment in parallel
This policy combination not only includes the traditional comprehensive reserve requirement ratio cut, interest rate cut, and LPR guidance, but also for the first time focuses financial resources on consumption, pension, technological innovation, capital market and other fields. From the total amount of funds to the financing structure, from short-term stimulus to long-term layout, multi-dimensional efforts have been made to inject financial impetus into the economy with equal emphasis on "stabilizing growth" and "adjusting structure".
At the same time, the liquidity support and risk-sharing tool innovation of the capital market also provide more solid policy support for the current A-share and bond markets. For digital assets and innovative finance, this sends a clear signal that financial technology and innovative enterprises may receive greater policy support in the future.
In this context of "plenty of money" and "warm policies", how to capture the flow of funds, trend switching and the "trends" in key areas has become the focus of investors. Through Mlion.ai's on-chain data tracking, news sentiment analysis and policy event analysis, market opportunities under policy dividends can be more keenly identified, providing "data + insight" intelligent assistance for the layout of the next stage.
Disclaimer: The above content is for information sharing only and does not constitute any investment advice! Investment is risky, so be cautious when entering the market.