PBOC Cuts Bank Reserves

China’s central bank increased its economic stimulus measures even further Wednesday amid growing concerns about the rate of expansion in the world’s second-largest economy.

The People’s Bank of China (PBOC) decided to cut banks’ reserve requirement ratio (RRR) by 50 basis points to 19.5 percent. The move, effective Thursday, is the first such cut since May 2012. This will lower the amount of deposits that each lender is required to hold as reserves.

The measure will help keep the economy stable, the PBOC said alongside the decision which was announced around 10:30 a.m. GMT. It added that it will also help guide the appropriate growth in social financing.


This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.