Analysts Not Optimistic About Rate Cut Results

As said previously, China has a greater ability to shift costs in its economy, but it is not immune to economic reality. The cost of inflation and credit bubbles cannot be avoided, at best it can be delayed and shifted. Now the bill is coming due.

China's rate-cut likely to hurt banks, curb new loans to small borrowers
China's latest interest rate cut is set to dent the profitability of domestic lenders, especially mid-sized banks, which are already suffering from higher bad loans and a slowdown in profit growth.

The central bank unexpectedly cut rates late on Friday, stepping up efforts to support small and medium-sized enterprises (SMEs) which are struggling to repay loans and access credit, as the economy slides to its slowest growth in nearly a quarter of a century.

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