Asia Local Markets Weekly: A constructive tone in Beijing

Research evidence excerpt

Asia Local Markets Weekly: A constructive tone in Beijing

14 May 2026

Asia Local Markets Weekly

suggests policymakers want tighter control over how liquidity conditions feed into Figure 3: PBoC’s priority shifts away

bank funding and lending. The broader implication is that the central bank believes from growth and inflation

the system already contains sufficient accommodation; the more important

question is whether that accommodation is reaching the real economy efficiently.

RMB internationalization in focus While the PBoC’s exchange rate discussion was

mostly unchanged, it notably reintroduced the phrase “create a stable exchange

rate environment for the real economy,” which was absent in the prior report but

present in the Q2 and Q3 2025 reports. This aligns with our view that the PBoC

prefers a managed RMB appreciation that is not disruptive to the real economy.

Source : Deutsche Bank Research, PBoC

The Bank also added new detail on RMB internationalization. The Q1 2026 report Note:word countFor eachfor report,each ofwethecalculatesix priorities.the proportionEach priority’sof keyproportionphrase is

introduced language around optimizing cross-border fund management for FDI thenstandardstandardizeddeviation.intoRankingsa z-scorereflectbasedtheseon itsz-scores,historicalindicatingaveragehowand

and overseas loans—points also raised during the Premier's opening speech at the stronglytypical coverage.each priority is emphasized in that report relative to its

National People's Congress. We believe the PBoC is seeking to broaden the RMB's

role as a funding currency, a natural next step in its internationalization agenda.

Figure 4: PBoC’s most recent report shows a less supportive tone compared to 4Q25

Deutsche Bank AG/Singapore Page 5