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PBOC to cut reserve requirement ratio for second time this year
Published on: 2021-12-07
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China's central bank said on Monday it would cut the amount of cash that banks must hold in reserve, its second such move this year, releasing 1.2 trillion yuan in long-term liquidity to bolster slowing economic growth.
 

The People's Bank of China (PBOC) said on its website it would cut the reserve requirement ratio (RRR) for banks by 50 basis points (bps), effective from Dec. 15.
 

The world's second-largest economy, which staged an impressive rebound from last year's pandemic slump, has lost momentum in recent months as it grapples with a slowing manufacturing sector, debt problems in the property market and persistent COVID-19 outbreaks.
 

Some analysts believe growth could slow further in the fourth quarter from the third quarter's 4.9%, although the full-year growth could still be around 8%.
 

The cut, the second this year following a similar broad-based reduction in July, was flagged by Premier Li Keqiang on Friday as a way to step up support for the economy, especially small firms.
 

The cut will not apply to financial institutions with existing RRR of 5%, it said, adding that the weighted average RRR for financial institutions will be at 8.4% after the new reduction.
 

央行宣布12月15日下调金融机构存款准备金率0.5个百分点
本次降准释放长期资金1.2万亿元

12月6日,央行宣布,为支持实体经济发展,促进综合融资成本稳中有降,决定于2021年12月15日下调金融机构存款准备金率0.5个百分点(不含已执行5%存款准备金率的金融机构)。本次下调后,金融机构加权平均存款准备金率为8.4%。此次降准共计释放长期资金约1.2万亿元。

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