China May Cut Reserve Ratio for Small Banks First,Barclays Says

China may cut the reserve- requirement ratio for lenders by the end of the year, with a reduction for small banks more likely to occur first, according to Barclays Plc.

“Our view has been that we would not rule out an RRR cut towards year-end and think an RRR cut for smaller banks, which have more exposure to SMEs, could happen first as was the case in late 2008,” Yiping Huang, Jian Chang and Lingxiu Yang, Hong Kong-based economists at Barclays, said in a report.

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