China’s Covid-Hit Economy Leaves Door Open for PBOC Easing
- Economists call for more reductions in RRR, interest rates
- Tighter Covid controls have curbed business, consumer activity
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China’s worsening economic slump and a likely disruptive rollback of Covid restrictions will keep the central bank on its easing path, economists said, with calls growing for more interest rate cuts.
A Friday announcement by the People’s Bank of China to cut the reserve requirement ratio for banks -- providing them with more cash to extend loans -- came as a surprise to many analysts given the central bank’s recent warnings on inflation risks.