What they say

The announcement came in slightly earlier than expected. The central bank was cautious in terms of permanently injecting liquidity using the RRR cut in 2014. We are now looking for a total of three RRR cuts in 2015. We maintain our forecasts of two interest rate cuts in the first and second quarters respectively.

Chang Jian, chief China economist at Barclays Plc

Despite November's interest rate cut, monetary conditions are rather tight. Credit uptake has remained depressed as excess capacity and subdued demand are entrenched. We still expect the central bank to cut interest rates in the first quarter, and inject liquidity into the financial system.