This is the last article you can read this month
You can read more article this month
You can read more articles this month
Sorry your limit is up for this month
Reset on:
Please help support the Morning Star by subscribing here
THE People’s Bank of China announced a cut today in the minimum level of reserves that banks are required to hold in a move to reverse an economic slowdown.
The reduction should make more money available for lending and support small and rural enterprises, construction projects and other activity, the People’s Bank said.
The deposits required of China’s commercial lenders will be reduced by at least 0.5 per cent.
The new stimulus measures were expected after last year’s economic growth slipped to a 24-year low of 7.4 per cent, alongside stagnation in Europe and Japan.
It is the equivalent of adding about 600 billion yuan (£63bn) to the balance sheets of China’s state banks.
“The move increases their capacity to lend by allowing them to hold more customer deposits for a given level of reserves,” said Mark Williams of Capital Economics.
