The People’s Bank of China announced that it will reduce the deposit reserve ratio by 0.5 percentage points next Monday and release more than 800 billion yuan in long-term funds
The market is worried about the downturn of the mainland economy. According to analysis, the People’s Bank of China lowered its current level to stabilize economic development.
The People’s Bank of China stated that in order to support the development of the real economy and reduce the actual cost of social financing, the deposit reserve ratio was reduced by 0.5 percentage points on the 6th of this month
The person in charge of the People’s Bank of China said that the overall RRR cut reflects counter-cyclical adjustments, releasing more than RMB 800 billion of long-term funds. Among them, small and medium-sized banks at provincial and county levels can receive more than 120 billion RMB of long-term funds. About 15 billion yuan, which helps small and medium-sized banks to serve small and micro-enterprises, the financial strength of private enterprises, and reduces the actual cost of social financing.
The person in charge said that the Mainland will continue to implement a prudent monetary policy, remain flexible and appropriate, and refrain from “flooding floods”, and create a suitable monetary and financial environment for high-quality development and supply-side structural reforms.
Zeng Kanghua, director of the Department of Finance at the Central University of Finance and Economics, believes that the central bank’s RRR cut is to maintain growth
“Because in 2019, the economic growth in the first, second and third quarters is gradually declining. The world ’s economic operation is also in a state of decline, so I think The central bank’s deposit reserve ratio has fallen. It is mainly relaxing its money, expanding credit, and injecting capital into the market to keep the economic growth stable, stable, and even picking up. “He estimates that the Mainland will launch a series of related cars. And real estate policies to stimulate internal consumption.