Godlike Productions - Discussion Forum
Users Online Now: 1,246 (Who's On?)Visitors Today: 196,513
Pageviews Today: 393,854Threads Today: 114Posts Today: 2,541
06:40 AM


Rate this Thread

Absolute BS Crap Reasonable Nice Amazing
 

The Chinese Central Bank Freaked Out Over A Bank Lending Spike Unlike Anything It Had Ever Seen Before In History

 
Anonymous Coward
User ID: 42054964
United Kingdom
07/02/2013 07:41 AM
Report Abusive Post
Report Copyright Violation
The Chinese Central Bank Freaked Out Over A Bank Lending Spike Unlike Anything It Had Ever Seen Before In History
The final two weeks of June were characterized by market turmoil that seemed to stem from the actions of two central banks.

First there was the Fed actions. Talk of the "taper" caused US interest rates to jump and equity markets to fall, as traders started to anticipate monetary tightening at an earlier date than previously thought.

But at the same time, in China, there was a spike in SHIBOR (which is China's equivalent of LIBOR) which screamed cash crunch for China's banks.

That too freaked markets out, and now thanks to Lingling Wei and Bob Davis at WSJ we have a better idea of why SHIBOR (which has since calmed down) spiked so hard.

Basically (and this was suspected at the time) the People's Bank of China let the rates spike as a tough measure to induce a level of tightening and discipline in the banking system.

More: [link to www.businessinsider.com]





GLP