Forex News

09:39:55 19-10-2021

China’s Policy Adviser: PBOC should cut RRR

Yao Jingyuan, a special researcher at the Counselor’s Office of the State Council said on Tuesday, the People’s Bank of China (PBOC) has room to lower the Reserve Requirement Ratio (RRR) and, therefore, should cut the ratio to support the economic growth.

Key quotes

The reserve requirement ratio “can be lowered by 1 percentage point in the fourth quarter.”

“We don’t need to worry about whether releasing more money will push inflation higher because we still have room.”

“Consumer inflation is likely to be 1% for the full year.”

“A 1 percentage-point cut would unleash 1 trillion yuan ($156 billion) of liquidity. Based on on-the-ground investigations, the liquidity condition of companies remains generally quite tight.”

Related reads

  • PBOC’s Yi: China can ‘contain’ the risk from Evergrande
  • PBOC unlikely to alter the RRR this year – Goldman Sachs
News provided by the portal FXStreet
Contacts
Close
Up