BEIJING—China's central bank said Saturday it will cut banks' reserve requirement ratio by 0.5 percentage point, effective Feb. 24, in a move to help boost liquidity and support the economy.
The move signals that Chinese authorities remain more concerned about risks to growth than price pressures, despite an unexpected acceleration in inflation last month.
"This RRR cut is very good news to the market. It will help release liquidity and allow banks to extend more loans," said HSBC economist Ma Xiaoping, adding that the cut will likely release around 400 billion yuan ($63.5 billion) liquidity.
The move signals that Chinese authorities remain more concerned about risks to growth than price pressures, despite an unexpected acceleration in inflation last month.
"This RRR cut is very good news to the market. It will help release liquidity and allow banks to extend more loans," said HSBC economist Ma Xiaoping, adding that the cut will likely release around 400 billion yuan ($63.5 billion) liquidity.
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