The People’s Bank of China (PBOC) said it would cut the reserve requirement ratio (RRR) for almost all banks by 0.25 percentage points, effective March 27. “[We must] make a good combination of macro policies, better serve the real economy, and maintain reasonable and sufficient liquidity in the banking system,” the PBOC said in a statement. The central bank had already injected hundreds of billions of yuan into the banking system since January, mainly through a medium-term lending facility, the analysts said. Regulators on both sides of the Atlantic have taken emergency measures since Sunday to provide liquidity support to troubled lenders and shore up the confidence in the banking system. But he also acknowledged that the RRR cut “remains an effective monetary policy tool” to provide long-term liquidity and support the economy.

Source: CNN March 17, 2023 18:09 UTC