China to Reduce Reserve Requirement Ratio
BEIJING (Reuters) – China has room to further cut the reserve requirement ratio (RRR), currently averaging 6.6%, according to a central bank official speaking on Saturday via state broadcaster CCTV.
This week, China announced plans to increase the budget deficit, issue more debt, and loosen monetary policy to stabilize economic growth.
The People's Bank of China (PBOC) has consistently decreased interest rates and injected liquidity this year to achieve an official economic growth target of approximately 5%.
Wang Xin, director of the PBOC's research bureau, stated that strengthening interest rates is crucial for facilitating transmission and guiding thorough social financing costs to decrease steadily.
Wang also commented on the PBOC's ongoing exploration of buying and selling government bonds in the secondary market, suggesting that the central bank should utilize various monetary policy tools in the future to ensure sufficient medium- and long-term liquidity and maintain adequate liquidity within the banking system. This was mentioned at an economic conference.
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