Multiple Banks Lower USD Deposit Rates, 3% to Become a Temporary Peak

　　Recently, a reporter posing as an investor investigated the latest USD deposit market conditions. Staff from multiple banks indicated that USD time deposit interest rates have already been lowered.

　　On September 29, a Huaxia Times reporter learned from Bank of Xi'an that the bank began implementing new USD deposit standards on September 28. Before the adjustment, three out of five deposit term brackets had interest rates above 4%. After the adjustment, all deposit term rates fell within the 3% range. Among these, the 3-month deposit term saw the largest adjustment, a decrease of 0.5%.

　　"Interest rates may soon head towards the '2% range'," Xue Hongyan, a special researcher at Sushang Bank, told the Huaxia Times reporter. He stated that the overall downward trend in USD deposit rates is now difficult to reverse. 3% will become a temporary peak, with rates gradually approaching the 2.5%-2.8% range subsequently.

　　Since the beginning of this year, banks have been quietly adjusting their USD time deposit rates. The Huaxia Times reporter learned through interviews that this year, products from several banks with USD deposit rates starting with "4" have been lowered, entering the "3" era.

　　On September 29, the Huaxia Times reporter called Bank of Xi'an and found out that the bank's USD deposit rates for 1-month, 3-month, 6-month, 1-year, and 2-year terms have been reduced from 3.6%, 4.1%, 4.3%, 4.3%, and 3.8% to 3.2%, 3.6%, 3.98%, 3.98%, and 3.6%, respectively.

　　Regarding the decrease in USD deposit rates, Lin Yingqi, Director of the Research Department and Banking Analyst at CICC, believes it is related, on one hand, to the Federal Reserve's announcement of a 25-basis-point rate cut in September, which caused short-term USD interest rates to follow suit. Therefore, banks began lowering deposit rates to reduce liability costs.

　　On the other hand, Lin Yingqi mentioned that the recent strengthening of the RMB exchange rate has increased investors' willingness to allocate more to RMB assets. Banks also have an incentive to proactively shrink the scale of their USD assets and liabilities.