On Friday, the 15th of March 2019, the Chinese Premiere, Li Keqiang said that China wanted to avert a steep economic contraction by any means, even if it would cost a slash on the interest rates. A fresh news of China’s monetary policy shift towards an interest cut for prevailing the dangers of an imminent recession, which had kept posting disdainful data since the beginning of the year, came forward, a day after China had deduced Value Added Tariffs (VAT) over both imported and domestic vehicles, as an attempt to revive its slowing domestic sales and declining demands.
Citing wide-ranging uncertainties on multiple financial fronts and addressing to a possible interest rate cut, in a post-People’s Congress press conference on Friday (March 15th), the Chinese Premiere said, “Of course, we face many uncertain factors this year.
We need to prepare more. This is not monetary easing, but more effective support to the real economy. The economy must not slip out of a reasonable range, that is, we will not allow layoff waves”. The Chinese Premiere had also added that the critically high-end financial instruments such as interest rate cut could be used.
Apart from that, Li Keqiang had also said that the credit levels financial institutions such as banks had to reserve as collaterals might be eased.