Chinese Central Bank Calls for Phase-based Increase in China’s Macro-leverage Levels


The People’s Bank of China (PBOC) has called for gradual increases in China’s macro-leverage levels in order to help deal with the economic fallout of the COVID-19 pandemic.

The latest raft of official data from PBOC points to a marked rise in macro-leverage levels in China in the first quarter of 2020, as a result of the impacts of the novel coronavirus.

According to PBOC officials the rise in the macro-leverage ratio embodies the “support of counter-cyclical policy for the recovery of the real economy.”

PBOC has called for “allowing macro-leverage ratios to rise in a phase-based way and providing credit support to the real economy.

“This is mainly to effectively drive the resumption of work and production, and in actuality creates conditions for better maintaining rational macro-leverage ratio levels in future.”

A PBOC survey of 10,000 enterprises around China found that as of the end of April 97.5% had resumed activity. Industrial production has basically “returned to normal,” while service sector work rates are seeing a steady rise.

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