# China Cuts Rates, Injects Liquidity as Mainland Markets Sink - Bloomberg

> China's central bank provided short-term funding to banks and cut the interest rate it charges on lending in its first concrete steps to cushion the economy and falling markets from the new virus. The move followed sharp equity losses on the spreading outbreak.

- Date: 2020-02-03 · published 2020-02-03T12:00:00.000Z
- Category: macro · region China · magnitude medium
- Page: https://feedsoft.ai/events/54796-china-cuts-rates-injects-liquidity-as-mainland-markets-sink-bloomberg
- Commodities: [Chinese Yuan (CNY per USD)](https://feedsoft.ai/c/USDCNY.md)

## Why it matters

Monetary easing aims to support Chinese activity and demand for commodities, but the immediate effect on feed prices is limited while the virus disrupts consumption. Stimulus expectations can briefly support risk assets and industrial commodities.

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| USDCNY | 2017-06-01 | [Yuan's Forecasters Getting It Wrong as China Jolts Markets - Bloomberg](https://feedsoft.ai/events/70728-yuan-s-forecasters-getting-it-wrong-as-china-jolts-markets-bloomberg.md) | -0.2% | -0.2% |
| USDCNY | 2020-08-31 | [Chinese Yuan Tests 6.8 As PBoC Injects Liquidity, PMI Expands](https://feedsoft.ai/events/51838-chinese-yuan-tests-6-8-as-pboc-injects-liquidity-pmi-expands.md) | -0.3% | -0.8% |
| USDCNY | 2020-07-30 | [Chinese Yuan Slips As PBoC Injects Liquidity Into Banking System](https://feedsoft.ai/events/52326-chinese-yuan-slips-as-pboc-injects-liquidity-into-banking-system.md) | -0.9% | -1.7% |
| USDCNY | 2020-06-17 | [Chinese Yuan Mixed As PBoC Injects More Liquidity Into Banking System](https://feedsoft.ai/events/52833-chinese-yuan-mixed-as-pboc-injects-more-liquidity-into-banking-system.md) | -0.4% | -1.4% |
| USDCNY | 2021-01-28 | [China's yuan inches up as tight liquidity pushes interbank rates higher \| Financial Post](https://feedsoft.ai/events/49361-china-s-yuan-inches-up-as-tight-liquidity-pushes-interbank-rates-higher.md) | -0.3% | -0.4% |

## Sources

- bloomberg.com: https://www.bloomberg.com/news/articles/2020-02-03/china-adds-cash-to-ensure-liquidity-as-financial-markets-sink

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.