“Following the adjustment of the loan-to-deposit ratio, the central bank may relax control over credit quotas, and a rate cut in the second half of the year cannot be ruled out,” Guan Qingyou, deputy director of the Minsheng Securities Research Institute, said in an interview with reporters.

The China Banking Regulatory Commission recently announced that, starting July 1, it will further improve loan-to-deposit ratio supervision and adjust the calculation basis for the loan-to-deposit ratio. Six items, including agriculture, rural areas and small and micro enterprise financial bonds, will be deducted from the numerator of the loan-to-deposit ratio, while two deposit items, including large-denomination certificates of deposit, will be added to the denominator, aiming to ease pressure on banks to meet the loan-to-deposit ratio requirement and thereby support the development of the real economy.

Previously, the market had a relatively consistent expectation for relaxing the loan-to-deposit ratio. Some analysts believe that this adjustment to the calculation basis could, in theory, release more than 800 billion yuan in liquidity from commercial banks. Taking into account restrictions on each bank's scale and capital adequacy ratio, the actual funds released will be lower than the theoretical figure.

Regarding the background of this relaxation of the loan-to-deposit ratio, the CBRC said that, with changes in the asset-liability structure and business models of commercial banks and the development of financial markets, loan-to-deposit ratio supervision has also shown problems such as insufficient coverage, insufficient risk sensitivity, failure to fully consider differences in the term and stability of various sources and uses of bank funds, and difficulty in fully reflecting banks' liquidity risks.

However, Zhu Haibin, chief China economist at JPMorgan Chase, told a Securities Daily reporter that the deeper reason for this relaxation of the loan-to-deposit ratio lies, on the one hand, in its consistency with recent targeted relaxation measures for certain sectors (small enterprises and agriculture), such as targeted reserve requirement cuts; and on the other hand, in reserving space for structural adjustment of overall credit, because the recent contraction in shadow banking activity (such as interbank business) indicates that credit may continue to shift from non-bank financing to bank loans.

Regarding future economic trends, Guan Qingyou pointed out that China's economy still faces downward pressure in the third quarter. First, the real estate downturn has not ended, and neither sales nor investment has bottomed out; second, the base figure for the third quarter is significantly higher than that for the second quarter; third, external demand, which helped stabilize the economy in the second quarter, is unlikely to see further increment in the third quarter.

According to the latest data from the National Bureau of Statistics, the latest year-on-year increase in housing prices in 70 large and medium-sized cities was 5.6%, compared with 6.7% in April, while in January the annual increase in housing prices had climbed to 9.6%. The pace of housing price increases in China has slowed to the lowest point in 13 months. At the same time, among China's total exports in the first five months, two months saw consecutive cliff-like negative growth, and the current account surplus fell by as much as 84.1% in the first quarter of this year.

“The downward pace in the third quarter may be relatively small. GDP growth is expected to be 7.3% in the third quarter, while the fourth quarter may stabilize and rebound, with an expected 7.5%,” Guan Qingyou said. The main reason is that the intensity of recent policy easing has clearly increased, and the third wave of mini-stimulus, centered on “easy money + easy credit + easy fiscal policy,” is accelerating. In addition to local governments beginning to intensify implementation of the central government's requirements, the central level is also continuing policy adjustments, with the current focus on “easy credit.”

Gao Shanwen, chief economist at Essence Securities, believes that further market-based reform of interest rates and exchange rates, minimizing and early lifting of credit quota controls on real estate enterprises, and improving and strengthening the financial regulatory system centered on capital adequacy ratios should be used to promptly straighten out the behavior of commercial banks and the macro monetary control system, thereby combining dredging and blocking and taking preventive measures.