CHINESE investors jokingly call the central bank "central mama". They thanked her for dispensing a bit of love over the weekend by trimming interest rates and reducing some lenders’ required reserves. The rate cut, her fourth since November, took one-year benchmark lending rates to 4.85%, a record low for China.
Punters hope this will save the stockmarket from further carnage. Having led the world for much of the past year, China’s equities have been in free fall over the past two weeks, tumbling 19%. Had the central bank done nothing, the rout would have been sure to deepen. Was it a sign of “desperation”? Though some characterised it as such, China’s easing, on a closer read, is more calibrated than that.
S.R. | The Economist