The cuts represent continued pessimism among investment banks over Beijing’s growth target of around 5.5%.
Nomura and Goldman both noted that Beijing's stimulus response may be quite limited.
"In contrast with some people's concerns about too much policy stimulus in H2, the real risk is that Beijing's policy support may be too little, too late and too inefficient," Nomura said. Goldman Sachs said the surprise rate cuts do not necessarily signal the beginning of more aggressive easing, adding that policymakers not only face economic constraints, but also political ones.
"Their current focus is likely to be on stemming further downside risks and ensuring employment and social stability ahead of the 20th Party Congress," it said.
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