Thread by @Trinhnomics

China cut RRR by 50bps, effective 16 September, something widely expected by markets. Some banks get 100bps cut. The PBOC expects this releases CNY900bn. This is likely in response to the very weak credit data and also also weak hard data in July & likely weak data also in August

So here are the cuts from China:
50bps, effective 16 September
50bps, effective 15 October
50bps, effective 15 November

So total 150bps releasing CNY900bn or USD126bn or 0.97% or close to 1% of GDP.

So basically, 50bps for all lenders effectively 16 September but some city commercial banks w/ operations confined to their provinces will get an addition 100bps per the above.

Total the PBOC estimates that it will release CNY900bn or USD126bn to the system.

History of PBOC easing & where we are in terms of RRR 👇🏻👇🏻👇🏻- we are now at 13% effective 16 September.

Remember my post on how bad the lending data was? Well, this is the response.

Data coming out soon:
Imports: expectations are a decline of -6.4% YoY in USD (remember my rant yesterday on why Chinese imports matter?)
Exports: Small expansion due to front-loading
Monetary data (more is coming thanks to RRR)
FAI: Unlikely to be good
Retail sales: Likely weak

These are the assets that moved since the cuts to release roughly 1% of GDP in liquidity 👇🏻👇🏻👇🏻:
*Iron ore partied 🥳🥳🥳
*Brent crude too🥳
*China 30y yield lowered by 9bps🥳