China lowers bank reserve ratio, boosting stimulus as growth lags

China's central bank announced on Wednesday that it will allow more cash to circulate in the economy by reducing the amount of money that commercial lenders must hold as reserves. This move is part of a policy support aimed at bolstering the slowing economy. However, investors are not convinced and are urging Beijing to take more action.

By lowering the reserve requirement ratio, the People's Bank of China will inject $140 billion of long-term liquidity into the financial market. Despite this, investors are pressing for more measures to restore confidence amid China's debt crunch.

Key takeaways

China's central bank is allowing more cash to circulate in the economy by reducing the amount of money that commercial lenders must hold as reserves.
This move is part of a policy support to prop up the slowing economy.
Investors are unimpressed by this measure and are urging Beijing to take more action.
The People's Bank of China will release $140 billion of long-term liquidity into the financial market.

China lowers bank reserve ratio, boosting stimulus as growth lags

Key takeaways

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