Analysts Debate Meaning of Central Bank's Newest Regulatory Tool

(Beijing) – Shortly after the central bank announced an addition to its regulatory tool kit, the Short-term Liquidity Operation (SLO), analysts started wondering if this meant small-scale quantitative easing.

There is debate over that issue, but most analysts agreed that the new tool will have a significant impact on current principal regulatory instruments: banks' reserve-requirement ratio (RRR) and deposit and lending interest rates.