There is only one way to save the economy,

Economically: massive liquidity injection + very proactive fiscal policy, using new debt to eliminate old debt...

On Zz: ...

The policy signal of not lowering the LPR

The unchanged LPR in September does not mean that the policy will continue to maintain its stability. With the Federal Reserve's 50bp rate cut in September, the domestic LPR remaining unchanged today is indeed somewhat surprising. Minsheng Securities tends to believe that the current policy's intensity may be more critical. Especially considering that the economy in September may further slow down compared to August, it is undoubtedly necessary to "strive to achieve" the annual target, and it is very important to introduce policies at the end of the third quarter or the beginning of the fourth quarter. Moreover, a systematic and coordinated "combined approach" is needed, which may be the important reason for today's LPR to remain "temporarily" unchanged.

Historical experience: When overseas rate cuts are implemented, domestic monetary policy will also loosen, although the pace is not completely synchronized. In the previous two typical overseas rate cut cycles (2008, 2019-2020), domestic monetary policy also shifted to easing, but in both cases, the pace of domestic loose monetary policy lagged slightly behind overseas.

To balance the reduction of social financing costs and stabilize bank interest margins, China may prioritize lowering existing mortgage rates before reducing the 1-year LPR, which could be the optimal choice at present.

$SSE Index(000001.SH)$Hang Seng Index(00HSI.HK)$Hang Seng TECH Index(STECH.HK)