Economics
China Central Bank Holds Interest Rate With Focus Now on RRR
- PBOC keeps rate on one-year policy loans unchanged at 2.85%
- Cabinet signaled a reduction in the reserve ratio for banks
The People's Bank of China building in Beijing.
Photographer: Qilai Shen/BloombergThis article is for subscribers only.
China’s central bank refrained from cutting interest rates and injecting liquidity into the economy on Friday, disappointing analysts who had expected more forceful action to cushion growth from worsening Covid outbreaks.
The focus now shifts to a possible reduction in the reserve requirement ratio for banks, a move that would give lenders cheap funding to spur loans and growth in the economy. The State Council, China’s cabinet, hinted strongly on Wednesday of a reduction in the RRR.