China Cuts RRR by 50bps

The People's Bank of China (PBOC) reduced the reserve requirement ratio (RRR) for all banks by 50 basis points to 10% starting from February 5th, releasing up to 1 trillion yuan ($139.45 billion) to the market to boost the economic recovery.

This is the lowest RRR level since March 2007 and aligns with the PBOC's ongoing efforts to reinforce an uncertain economic recovery in light of the plummeting stock markets.

The PBOC had previously cut RRR by 25 bps in March and September last year.

Additionally, on January 25th, the PBOC lowered re-lending and re-discounting interest rates by 25 basis points, targeting the rural sector and small businesses.