![PBOC Releases $188B for Banks in Second Reserve Requirement Ratio Cut](https://forextraders.guide/wp-content/uploads/2021/12/PBOC.png)
Source: Bloomberg
China scaled back the amount of cash most banks must retain in reserve in a move to counter the economic slowdown. CSI 300 down -0.17%, CNY USD down -0.01%
- China’s Central Bank will lower the reserve requirement ratio by 0.5 percentage points for most banks on Dec.15, releasing 1.2 trillion yuan ($188B) of liquidity.
- The cut was signaled by Premier Ki Keqiang last week, stating that the Chinese authorities would scale back the RRR at the right time to aid small businesses.
- The decision comes after figures indicated that the Chinese economy and industry were stabilizing.
- PBOC stated that the reduction of RRR was a “regular monetary policy action,” pre-empting the move was a decision was the start of an easing period.
- PBOC further signaled that the bank will continue with a normal monetary policy to maintain stability, consistency, and sustainability of the policy.
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