China cuts reserve requirements to support economic recovery

Reuters2021-07-09

BEIJING, July 9 (Reuters) - China's central bank said on Friday it would cut the amount of cash that banks must hold as reserves, releasing around 1 trillion yuan ($154.19 billion) in long-term liquidity to help underpin an economic recovery that is starting to lose momentum.

The People's Bank of China (PBOC) said on its website it would cut the reserve requirement ratio $(RRR)$ for all banks by 50 basis points (bps), effective on July 15.

Banks that are subject to an RRR of 5% will be exempted from the new cut.

The PBOC last cut the RRR in April last year, when the Chinese economy was still badly jolted by the coronavirus crisis. As the economy staged a strong rebound, aided by the surprisingly resilient exports, the PBOC had since shifted to a moderately tightening bias.

The country's cabinet said on Wednesday that authorities will use timely cuts in RRR to help small firms cope with the negative impact from rising commodity prices, which came as a surprise to the market.

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Comments

  • tkkkkkkkkkk
    2021-07-09
    tkkkkkkkkkk
    Forcing banks to be unnecessary conservative..... No wonder our bank shares cannot perform.  MAS should learn. 
  • 欣欣宇
    2021-07-09
    欣欣宇
    Good 
  • 冰眼
    2021-07-09
    冰眼
    Pls like 
    • JeremyKok: 
      hi. please like and comment back. thank you.
  • spj
    2021-07-09
    spj
    Good catalyst for China stocks in US market 
  • teofi
    2021-07-09
    teofi
    Like and comment
  • a3sp3c7
    2021-07-09
    a3sp3c7
    Nise
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