According to Oxford Economics chief economist Louise Loo, “the asymmetric moves signal the authorities’ continued preference for targeted easing and their desire to ramp up support for the property sector.” “We believe that Beijing policymakers are genuinely concerned that the ‘incremental’ slow-drip of policy easing that has been implemented thus far has had little impact, as evidenced by the size of today’s move.”
Nevertheless, mortgages are not ultimately the cause of China’s real estate issue. The action taken today may increase demand on the edges, but in order to effectively manage the inevitable process of property correction, it must be done and viewed in the context of a wider range of actions, according to Loo.