BNP - Investors Corner: An easing of monetary policy is underway in China

On the last day of February, the People’s Bank of China (PBoC) announced a cut in benchmark lending rates by 25bp to 5.35% with benchmark deposit rates being reduced by 25bp to 2.50%. This is the second rate cut in three months and bolsters our conviction that further broad-based monetary policy easing is on the way this year. Chinese equities will, in our view, get a boost from looser monetary policy.