China made the deepest cut since 2020 to a key interest rate before posting a disappointing July report card

Less than an hour before releasing another series of disappointing economic indicators, China's central bank unexpectedly cut key policy rates, signaling the government wants to ramp up efforts to turbo-charge the country's post-pandemic recovery. The People's Bank of China slashed its one-year medium-term lending facility rate by 15 basis points to 2.5%, the deepest cut since 2020. The central bank also cut a short-term policy rate by 10 basis points. Of the 15 analysts polled by Bloomberg, 14 had expected China to keep the lending rate unchanged. On Tuesday, China posted yet another round of disappointing economic data. Even more surprisingly, China omitted any mention of youth unemployment statistics in its July report card. "And with financial troubles at developers such as Country Garden likely to weigh on the housing market in the near-term, there is a real risk of the economy slipping into a recession unless policy support is ramped up soon - today's rate cut won't cut it," he wrote.