The People’s Bank of China did not follow the Federal Reserve’s emergency policy short-term rate cut, leaving its borrowing costs unchanged on Wednesday.
The Central Bank did not open market operations according to its official statement on its website. However, investors still anticipate that the Chinese government will find ways to cut other financing costs for businesses and make way for monetary easing and other measures to boost the economy that is continuously hit by the outbreak of the new coronavirus.
The PBOC released its statement of keeping rates steady following the development in the U.S., imposing an emergency 50-basis point rate cut to cushion the hard impact of the virus to the global economy.
Despite the rate cut by the Fed, unrest persisted throughout the U.S. markets fueled by the economic slowdown of major economies.
“Pressure from consumer prices remained huge, and Consumer Price Index (CPI) was likely hovering at elevated level in February,” Yan Se, chief economist at Founder Securities, Beijing, said in a statement.