Goldman: PBOC Actions Were To Boost Liquidity

Don’t be deceived by signals coming out of the People’s Bank of China. When the media reported the PBOC had approved a 100 basis point cut in the bank’s Reserve Requirement Ratio (RRR), that was not an easing signal, Goldman Sachs analysis surmises. The Goldman analysis comes nearly one month after they proclaimed not to be worried about a China credit crisis. One month later, however, they noted Chinese defaults are rising rapidly. Chinese Debt Called “Fatal” By Chinese Think Tank PBOC reduction in Chinese big bank reserve ratios resulted more from the need for liquidity Last Friday, when Chinese…