Whenever People’s Bank of China Do Something…
21 March, 2011, 15:07. Posted by Zarathustra
Tags: Interest Rates, People's Bank of China
I was curious.
I wanted to know what the monetary tightening by People’s Bank of China has done to the market.
Using Shanghai Interbank Offered Rate (SHIBOR) as a guide, comparing the SHIBOR curves before and after the announcements so far being made in 2011, the results of monetary policy tightening on market interest rates are mixed at best.
18 March 2011
50 basis points increase in Reserve Requirement Ratio (RRR):
Source: SHIBOR
18 February 2011
50 basis points increase in Reserve Requirement Ratio (RRR):
Source: SHIBOR
8 February 2011
25 basis points increase in interest rates:
Source: SHIBOR
14 January 2011
50 basis points increase in Reserve Requirement Ratio (RRR):
Source: SHIBOR
Despite the apparent mixed and sometimes erratic immediate results, two things do seem to have headed to the right direction over time. Both 6-month and 1-year SHIBOR have been rising:
Source: SHIBOR
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About Zarathustra
Zarathustra: Founder and Managing Editor of Also sprach Analyst. Once an analyst, now an investor and entrepreneur. Based in Hong Kong, but Londoner at heart.