BUSINESS China announces reserve requirement ratio cut

BUSINESS

China announces reserve requirement ratio cut

People's Daily app

17:13, March 17, 2023

The headquarters of the People's Bank of China in Beijing. (Photo: CFP)

China's central bank said Friday that it has decided to cut the reserve requirement ratio (RRR) for eligible financial institutions by 0.25 percentage points to keep liquidity reasonably ample.

The cut will take effect on March 27, except for financial institutions that have already implemented a 5-percent RRR, the People's Bank of China (PBOC) said in a statement.

After the reduction, the weighted average RRR for Chinese financial institutions will stand at about 7.6 percent, the central bank said.

The central bank said it would make prudent monetary policy precise and effective, better utilize monetary policy tools, keep liquidity reasonably ample, and ensure the growth of money supply and social financing basically in line with nominal economic growth.

The central bank will also make monetary policy better support key areas and weak links and avoid "flood-like" stimulus to promote high-quality economic development.

(With input from Xinhua)

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