China's central bank has announced a bold move to boost the economy - cutting reserve requirements for banks. This policy will free up long-term capital of 1 trillion yuan. News of this crucial change comes as China struggles to cope with economic challenges.
China's central bank has unveiled a new plan to boost the country's economic growth . Governor Gongsheng announced that from February 5, there will be areduction in the requirements for reserve ratio for banks by 50 basis points. The move will free up a record $141 billion ( 1 trillion yuan) of long-term capital to boost lenders' ability to lend and stimulate spending in the economy.
This reduction comes as the first move of its kind this year and follows two previous cuts last year. Mr Gongsheng also hinted that there is room for further monetary easing, which could lead to a modest recovery in consumer prices.
At a press conference in Beijing, Mr Gongsheng told reporters that the central bank and the National Financial…