China Funding Costs Surge as Loan Demand Jumps

The video discusses the rapid reopening of China's economy, which is increasing credit demand. This demand is causing a surge in interbank borrowing costs, reaching levels not seen since 2021. Unlike in 2021, when the PBOC engineered a credit squeeze, the central bank is now likely to provide more funding to stabilize the market. The video highlights the unique situation of heightened credit demand among Chinese banks.

What might the PBC do if rates pick up again?

What is the significance of the interbank market in the current economic context?