Bank reserve ratio cut to support economy

The People’s Bank of China, the nation’s central bank, announced on April 15 a cut in the reserve requirement ratio for financial institutions, in its latest move to support the real economy with a focus on smaller businesses and the agricultural sector.

Experts said the cut is expected to act as a timely move to stabilize the economy and alleviate difficulties facing hard-hit market players, while reflecting policymakers’ prudence in launching stimulus measures in the face of overseas central bank tightening.

The PBOC will lower the RRR for all financial institutions, excluding those already adopting a reserve ratio of 5 percent, by 0.25 percentage

point with effect from April 25, the central bank said in a statement on April 15.