According to Jinshi.com, CICC commented on the financial data for August and said that the growth rate of social financing in August fell slightly, and the growth rate of social financing in the non-government sector fell faster. Government bonds were the main factor supporting social financing.
Although the issuance of government bonds increased, fiscal deposits rebounded significantly. Therefore, the fiscal policy was still to recover liquidity in August, which dragged down M2 (broad money). The actual effect of fiscal expansion has not yet been reflected and subsequent injections remain to be seen.
"Financial disintermediation" has weakened. If fiscal investment goes smoothly, it will help the recovery of M2 growth. Whether the M2 growth rate can recover depends on whether the fiscal force can be continuously strengthened. Looking forward, in the short term, the probability of lowering the reserve requirement ratio among the "incremental policy" options is greater than lowering interest rates.
