China smiles and waits as world cuts rates

No rate cut: A file picture shows a woman standing in front of a signage at the lobby of the PBoC headquarters in Beijing. It’s a foregone conclusion that China won’t cut rates presently. — Bloomberg

China’s state-driven economic model has created many problems. Monetary policy isn’t one of them.

With the US Federal Reserve cutting rates this week and the European Central Bank poised to follow suit in September, the temptation is high for other central banks to fall in line. More likely than not, the People’s Bank of China (PBoC) will sit tight, watching developed nations play out what is a zero-sum game.