No Hint of a Cut – Takeaways from the PBoC's 3Q26 Monetary Policy Report

The PBoC published its 3Q26 Monetary Policy Report today (PBoC, Nov 11). With incremental policies in execution, the annual growth target on track, and exports remaining strong, the MPR provides little new information. The PBoC discussed shifting loan pricing benchmarks to diversify away from the LPR following the re-anchoring of policy rates, while remaining cautious on low interest rates. This reinforces our view that an LPR cut in November is not plausible. We continue to expect the PBoC to remain on hold for the rest of this year followed by two 10bp rate cuts in 2027E, with the bar for more aggressive easing remaining high. On the re-anchoring follow-ups, there was no mention of a formal review cycle; the central bank discussed shifting loan pricing toward more diversified benchmarks, highlighting DR001 as an additional pricing reference; and quantitative growth targets for the monetary base and TSF were reiterated. The average loan rate still fell 2bp in September versus June des