China easing

China cuts reserve requirements as economy slumps

The People’s Bank of China will cut the reserve requirement ratio for banks as it moves to stabilise growth.

<div style="text-align: left;"> Chinese banks now have more money to lend, but will borrowers want it? (ImagineChina) </div>

Nick Ferguson

May 14, 2012

China’s central bank said it would cut banks’ reserve requirements on Friday, after a set of disappointing trade data. Effective May 18, it will cut the reserve requirement ratio for banks by 50bp to 20%, which it hopes will free up lending and stimulate a recovery — or at least avert a hard landing.

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