Bad Loan Jump Targeted by Surprise PBOC Rate Cut: China Credit
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China’s first interest-rate cut since 2012 is prompting investors to bet on further monetary easing as policy makers react to the biggest jump in bad loans in nine years.
Non-performing loans surged 10 percent last quarter, the most since 2005, as the property market slumped and the economy slowed. New-home prices declined in October in 67 of 70 major cities, while housing sales slumped 10 percent in the first 10 months from a year earlier, official data showed last week. The one-year swap rate, the fixed cost to receive the seven-day repurchase rate, slumped 20 basis points today to 2.92 percent.