China’s central bank slashed its one-year policy loan rate by 30 basis points to 2%, marking the largest cut since the introduction of the medium-term lending facility (MLF) in 2016. This move is part of a broader stimulus package aimed at reviving confidence in the world’s second-largest economy and addressing deflationary risks. The yuan surged past the 7-per-dollar mark for the first time in 16 months, and Chinese stocks rallied. The People’s Bank of China (PBOC) is also expected to reduce the seven-day reverse repurchase rate and implement reserve requirement ratio (RRR) cuts to inject long-term liquidity, helping China achieve its 5% annual growth target.
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