China’s central bank unveiled a broad package of monetary stimulus measures to revive the world’s second-largest economy.
People’s Bank of China governor Pan Gongsheng cut a short-term key interest rate and announced plans to reduce the amount of money banks must hold in reserve to the lowest level since at least 2018 at a rare briefing alongside two of the country’s other top financial regulators in Beijing. That marked the first time reductions to both measures were revealed on the same day since at least 2015.
Those moves were followed by a slew of other announcements that fueled gains in Chinese stocks. The central bank chief also unveiled a package to shore up the nation’s troubled property sector, including lowering borrowing costs on as much as $5.3 trillion in mortgages and easing rules for second-home purchases.
For the nation’s beleaguered equity market, Pan said the central bank will provide at least 800 billion yuan ($113 billion) of liquidity support, adding that officials were studying setting up a stock stabilization fund.
Chinese ADRs jumped in premarket trading. YINN rose 13%; Alibaba and XPeng rose 5%; NIO rose 6%; PDD Holdings rose 4%; JD.com and Li Auto rose 7%.
