China’s PBoC Gets Creative Amidst A Slowdown

• China’s growth momentum continues to decline.
• The central bank keeps its focus on improving monetary policy transmission.
• In a bid to prop up bank credit, the PBoC created an innovative tool yet again.
• The CNY led the other EM Asian currencies to a good start of the year.
• We stand by our view that CNY will approach 6.75 against the greenback by end-2019.

China’s growth momentum continues to decline. Following the moderation of GDP growth to 6.4% y/y in Q4, high frequency indicators are pointing to continued deterioration, as we have expected. Industrial profits declined 1. ...