AI Data Insight
According to the latest data, China's M1 minus M2 scissors gap for Q2 2026 stood at -3.6%, widening slightly from -3.4% in the previous quarter (Q1), reflecting that the growth rate of demand deposits still lags behind broad money. Although the People's Bank of China (PBOC) maintained a moderately loose policy to ensure abundant overall liquidity, cautious corporate investment sentiment has led to the "time-depositization" of funds. If external demand weakens in the future, authorities are expected to further intensify efforts to cut the reserve requirement ratio (RRR) and interest rates to stimulate the vitality of the real economy.