Headquarters of the People's Bank of China (PBOC), the central bank, is pictured in Beijing, Sept 28, 2018. (Photo / VCG)
BEIJING - China's central bank announced Friday to cut the reserve requirement ratio for financial institutions by 50 basis points from Sept 16 to support the real economy and reduce the real cost of social financing.
About 800 billion yuan will be released from the broad-based RRR cut
About 800 billion yuan will be released from the broad-based RRR cut.
The People's Bank of China also announced an additional 100 basis points reduction in the RRR for city commercial banks operating only in provincial administrative areas will be implemented in two phases, Oct 15 and Nov 15, cutting 50 basis points in each phase.
The targeted RRR cut will release 100 billion yuan, with aims to promote support for small and private enterprises.
The cut will not cover three kinds of financial institutions, namely finance companies, financial leasing companies and auto financing companies, whose RRR is 6 percent, the lowest among financial institutions, the central bank said on its website.
The central bank stressed it will continue to implement the prudent monetary policy and will not engage in a deluge of strong stimulus policies, in order to create a suitable monetary and financial environment for high-quality development and supply-side structural reform.
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