Driven by multiple factors, the weighted average interest rate of loans once again broke the record low. According to the report on the implementation of China's monetary policy in the second quarter of 2022 released by the people's Bank of China a few days ago, the weighted average interest rate of loans and the weighted average interest rate of enterprise loans in June were 4.41% and 4.16%, respectively, the lowest since statistics. This is not only caused by the pricing impact caused by the weakening of credit demand for a time, but also affected by the release of dividends from the reform of the quoted interest rate (LPR) in the loan market. It also reflects the role of the optimization of deposit interest rate regulation in stabilizing the cost of bank liabilities. It also highlights that under the complex and changeable internal and external situation, the financial management department has created a favorable monetary and financial environment to support the real economy and reduce the financing cost of enterprises. The efficiency of LPR reform highlights the enhanced competitiveness of the credit market. In the second quarter of this year, "where to find loan customers" once became a difficult problem for banks. "In the first half of the year, the contradiction between supply and demand of loans was relatively prominent. The policies related to stable loan supply and market competition pressure jointly squeezed the downward trend of loan pricing." Said Wen bin, chief economist of Minsheng Bank. From the policy perspective, LPR reform has become more effective and the credit market has become more competitive. The monetary policy transmission mechanism of "market interest rate + central bank guidance LPR loan interest rate" is more smooth. Since the beginning of this year, the one-year medium-term loan facility (MLF), as the policy interest rate, has been reduced by 10 basis points, and the LPR over one-year and five-year periods has been reduced by 10 and 20 basis points to 3.70% and 4.45%, respectively, driving the steady decline of enterprise loan interest rate and the obvious decrease of enterprise financing cost. According to the data provided by the people's Bank of China, the weighted average interest rate of loans and the weighted average interest rate of enterprise loans in June decreased by 35 basis points and 41 basis points respectively compared with the beginning of the year. In addition, the weighted average interest rate of personal housing loans in June was 4.62%, down 101 basis points from the beginning of the year. At the same time, thanks to the continuous promotion of the marketization of deposit interest rates, the cost of the bank's liability side fell. Since the beginning of this year, the people's Bank of China has guided the interest rate self-regulation mechanism to optimize the formation of the deposit interest rate self-regulation upper limit, and at the same time has urged the orderly reduction of illegal deposits. In April, state-owned banks and most joint-stock banks lowered the interest rates of fixed-term deposits and large-scale certificates of deposit with a term of more than one year, and some local legal entities also lowered the interest rates accordingly. The role of price instruments in pushing down the loan interest rate is obvious, and the utility of quantity instruments can not be ignored. Wang Yifeng, assistant director of Everbright Securities Research Institute, said that the dividends of various structural monetary policy instruments launched this year have been fully transferred to various profit units by the treasurer of the head office of commercial banks through internal fund transfer pricing (FTP), which helps to reduce the loan interest rate. "Reducing the financing cost of the real economy is one of the focuses of China's economic work. In recent years, the monetary policy has also actively promoted the achievement of this goal." Mingming, chief economist of CITIC Securities, said that the role of structural monetary policy tools is obvious, such as various special refinancing and carbon emission reduction support tools, which help direct liquidity to entities and support financing in key areas and weak links. In addition, improving the formation and transmission mechanism of market-oriented interest rates and giving play to the efficiency of the reform of quoted interest rates in the loan market will also help to promote the reduction of the comprehensive financing cost of enterprises