LINE

Text:AAAPrint
Economy

China's central bank denies rumors of targeted RRR cut

1
2019-04-25 09:06:15Global Times Editor : Li Yan ECNS App Download

The People's Bank of China (PBOC), the nation's central bank, has denied rumors of a 100 basis point targeted reserve requirement ratio (RRR) cut covering rural financial institutions that would be effective on Thursday. 

The PBOC said that at present, there is no new policy on targeted RRR cuts, according to financialnews.com on Tuesday.

The PBOC also denied plans to adjust reserve requirements based on the quarterly macro prudential assessment, according to the report. Currently, the targeted RRR change for inclusive finance only takes place at the beginning of every year, the PBOC responded. 

This is the second time in less than one month that the PBOC has denied rumors of RRR cuts. On March 29, the central bank denied reports of a 50-basis-point RRR cut. 

The central bank has filed police reports over the rumors.

"The rumors that have been going on since the beginning of this year could mean that there is a market expectation of RRR cuts, but statistics from the first quarter of 2019 show that China's economy is reviving and there is sufficient liquidity in the economy," Liu Xuezhi, an economist at Bank of Communications, told the Global Times. "Unnecessary RRR cuts would only increase liquidity and generate inflationary pressure."

In the first quarter of 2019, GDP grew 6.4 percent year-on-year, official data showed. 

Liu forecast that monetary policy would remain prudent and neutral in at least the current quarter. Such a stance would also be in line with the PBOC's prudent monetary policy.

During a quarterly meeting of the PBOC's monetary policy committee on April 15, regulators vowed to maintain a prudent monetary policy and strengthen coordination among monetary, fiscal and other policies to prevent risks and maintain stable growth."Especially as the economy is now performing above expectations, monetary policy should refrain from using a deluge of stimulus," Liu said. 

The PBOC's swift response to the rumors also shows it is very cautious of any unexpected policy change that would cause market volatility, Liu said.

Related news

MorePhoto

Most popular in 24h

MoreTop news

MoreVideo

News
Politics
Business
Society
Culture
Military
Sci-tech
Entertainment
Sports
Odd
Features
Biz
Economy
Travel
Travel News
Travel Types
Events
Food
Hotel
Bar & Club
Architecture
Gallery
Photo
CNS Photo
Video
Video
Learning Chinese
Learn About China
Social Chinese
Business Chinese
Buzz Words
Bilingual
Resources
ECNS Wire
Special Coverage
Infographics
Voices
LINE
Back to top Links | About Us | Jobs | Contact Us | Privacy Policy
Copyright ©1999-2019 Chinanews.com. All rights reserved.
Reproduction in whole or in part without permission is prohibited.