(CNBC) Chinese central bank on Friday decided against lowering the interest rates, which dampened the sentiment on shares listed in the mainland.
The People’s Bank of China voted to keep the rate on the medium-term rates unchanged amid challenges of the Omicron wave. The move disappointed market expectations of a lower rate to inject more stimulus to the Covid-19 hit economy.
Following the decision, China’s Shanghai composite fell by 0.45%, while the Shenzhen Component Index was down by 0.56%.
The fall in the mainland stocks happen hours after Chinese tech stocks listed in the US also declined following reports that Beijing was investigating Ant Group’s link with Chinese state firms
Shane Oliver, head of investment strategy at Australian financial services entity AMP, said that China is having challenges managing the Covid-19 wave amid its zero covid policy. The economist expected a softer stance as the virus threatened Chinese growth.
Julian Evans-Pritchard, senior China economist at Capital Economics, says PBOC’s move is surprising given a sharp economic downturn that called for more support.
SHA is down -0.45% SHE is down -0.56%, CSI 300 is down -0.067%.
