PBOC Pledges to Cut RRR and Interest Rates in 2026

2026-01-06 23:15 By Chusnul Chotimah 1 min. read

China's central bank said on Tuesday it will cut the reserve requirement ratio (RRR) and interest rates in 2026 to keep liquidity ample and continue to implement appropriately loose monetary policy, according to a statement on its website.

The People's Bank of China (PBOC) added that it would intensify counter-cyclical and cross-cyclical adjustments, defuse financial risks in key areas, and make efforts to expand domestic demand.

It will also make effective use of refinancing tools for services consumption and elderly care to drive increased credit allocation in the services consumption sector.

Among other priorities, the central bank highlighted the need to contain financial risks in key sectors, with plans in place to establish a mechanism to provide liquidity for non-banking institutions in specific scenarios.

The central bank also said it will keep the yuan exchange rate basically stable at a reasonable and balanced level and guard against the risk of an exchange rate overshoot.



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