PBoC takes action against tighter liquidity
Reserve requirement cut seeks to ease constraints on liquidity
The People's Bank of China (PBoC) today cut its reserve requirement ratio (RRR), in a move that will go some way towards easing increasingly tight liquidity conditions.
The central bank cut the RRR by 50 basis points for all banks in the first such broad-based action since 2012. A handful of banks that support lending to small and medium-sized enterprises (SMEs) received an extra 50bp cut, and Agricultural Bank of China a further four-percentage-point cut.
Helena Huang, a senior research officer
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