PBoC: Focused relief measures preferred to widespread reductions – DBS
DBS Group Research: PBoC Expected to Maintain 1-Year LPR at 3.00%
According to DBS Group Research, the People’s Bank of China is anticipated to leave the 1-year Loan Prime Rate steady at 3.00%. This outlook comes as China’s economic growth shows signs of strengthening and inflation trends improve. The report highlights that while international demand is bolstering industrial production, domestic economic activity remains inconsistent.
Stable LPR Forecast Amid Strengthening Growth
Analysts predict that the PBoC will keep the 1-year LPR unchanged, noting that economic growth accelerated from 4.5% year-on-year in the fourth quarter of 2025 to 5.0% in the first quarter of 2026. This suggests a more robust start to the year for China’s economy.
While overseas demand continues to support the industrial sector, domestic factors such as consumer spending, investment, and credit uptake are still subdued. Ongoing challenges in the property market and anti-involution pressures are contributing to this softness.
Improved inflation dynamics have reduced the immediate need for monetary easing, even as rising energy prices and supply chain issues present potential risks to the outlook.
Given the absence of a pronounced economic slowdown and the lack of a significant rebound in credit demand, policymakers are expected to favor targeted support measures rather than broad-based interest rate reductions.
Regional Central Banks Likely to Hold Rates Steady
As Indonesia and the Philippines adapt to evolving global economic conditions, their central banks are increasingly focused on managing inflation, capital flows, and currency stability. DBS Group Research anticipates that both countries will keep their policy rates unchanged at 4.75% and 4.25%, respectively.
(This report was produced with the assistance of artificial intelligence and subsequently reviewed by an editor.)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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VIPAI Asset Sell-Off and Selective Rotation in Crypto
1. Technology stocks fell sharply as investor interest shifted toward energy and selected defensive assets. From October 10 to 16, the Nasdaq 100 declined 5.49% and the S&P 500 fell 1.95%, while the Dow gained 0.67% and WTI crude rose 10.41%. BTC, ETH, and SOL declined 1.27%, 2.65%, and 4.44%, respectively. This week's technology earnings will be an important test of whether revenue growth, margins, and cash flow can justify current valuations. Better-than-expected results could help stabilize markets in the near term. 2. Crypto continues to see pockets of strong activity, but a broad-based altcoin season has yet to materialize. CoinMarketCap's (CMC) Altcoin Season Index stood at 54 as of the October 18 UTC daily observation, below the altcoin-season threshold of 75, while BTC dominance rose to 60.08%. Our proxy leverage ratio fluctuated between 4.00 and 4.07 during the week, showing no sustained increase and suggesting limited appetite for additional leverage. Meanwhile, as major exchanges expand access to traditional financial assets, the recent sell-off in AI-related equities could attract short-term speculative capital away from crypto. Such capital rotation could make it more difficult for a new altcoin season to take hold. 3. Papertrade's loss-to-mine model has generated significant interest across the crypto community. The protocol combines high-leverage derivatives trading with zero slippage and a mechanism that rewards trading losses with PAPER tokens. Across the eight complete UTC days from October 10 to 17, cumulative reported revenue reached approximately $56.08 million, including $51.90 million distributed to token holders. With growing participation from key opinion leaders (KOLs), Papertrade has reportedly ranked among the top three platforms by profitability in the broader market recently. Assets to watch: BTC, ETH, SOL, ARB, OP, SKHYNIX, SKHY, META, TSLA, LRCX, and SPCX. Key research priorities this week: Cash flow performance in technology earnings; the relative discount and holding costs of the two SK Hynix contracts; and U.S. initial jobless claims and PMI data. Weekly market data cover the period through October 16, while research information was verified through October 18. Observation periods are specified separately for each chart.
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