Global EditionASIA 中文双语Français
Business
Home / Business / Finance

Central bank announces reserve ratio cuts to boost liquidity

By Chen Jia | chinadaily.com.cn | Updated: 2020-03-13 17:41
Share
Share - WeChat
A teller counts cash at a bank outlet in Taiyuan, capital of Shanxi province. [Photo/China News Service]

China's central bank announced on Friday it would inject 550 billion yuan ($78.67 billion) of liquidity into the economy by cutting the cash amount commercial banks must reserve to stabilize market sentiment and support economic growth amid the novel coronavirus outbreak.

The cut of the reserve requirement ratio will take effect on Monday, lowering the RRR by 0.5 to 1 percentage points for a certain group of banks satisfying requirements for lending more to smaller businesses. A further cut of 1 percentage point will be prescribed for some joint stock commercial banks to encourage more credit into non-financial sectors, according to a statement from the People's Bank of China, the country's central bank.

The most recent RRR cuts came on Jan 6, through which the ratio for big banks was reduced to 12.5 percent from 13 percent, and for small and medium-sized banks to 10.5 percent from 11 percent, according to the PBOC.

The monetary authorities reconfirmed the country's monetary policy will remain prudent, but more flexible and moderate. The monetary policy will put economic recovery "in a more prominent position" without taking a "flood irrigation type" approach to easing, and to balance the economic situations at home and abroad.

The central bank also stressed it would keep ample liquidity at a reasonable level, and match the growth of credit and aggregate financing in line with economic growth.

Top
BACK TO THE TOP
English
Copyright 1995 - . All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily Information Co (CDIC). Without written authorization from CDIC, such content shall not be republished or used in any form. Note: Browsers with 1024*768 or higher resolution are suggested for this site.
License for publishing multimedia online 0108263

Registration Number: 130349
FOLLOW US
CLOSE