China Steers Credit to Small Business With Targeted Reserve Cut
- Central bank steers credit to small businesses and agriculture
- Manufacturing data signal uneven growth outlook across economy
Commuters stand at a bus station in Baotou, Inner Mongolia, China, on Friday, Aug. 11, 2017. China's economy showed further signs of entering a second-half slowdown, as curbs on property, excess borrowing and industrial overcapacity began to bite.
Photographer: Qilai Shen/BloombergChina took action to ensure credit reaches small business, rural borrowers and startups, a move tailored to shore up the economy as a vital political transition approaches.
The People’s Bank of China announced late Saturday that it would reduce the amount of cash that banks must hold as reserves from next year, with the size of the cut linked to the flow of funding to parts of the economy where credit has traditionally been scarce. That distinction was underlined Saturday by manufacturing sector indicators which showed that while large firms are feeling bullish, smaller producers are less so.