The official news outlet of the Chinese central bank has flagged the maintenance of steady monetary policy following the launch of the latest round of reserve ratio cuts to expand liquidity.
“However, the direction of stable monetary policy has in no way changed as a result of this.
“Irrespective of whether it’s a comprehensive reserve ratio cut or a targeted reserve ratio cut, the funds released will truly transform into market dividends, and effective benefit the real economy.
“For this reason, the next phase of policy adjustment will focus on clearing out monetary policy transmission mechanisms.”
On 16 September PBOC launched an across-the-board reduction in the required reserve ratio for Chinese financial institutions of 0.5 percentage points, unleashing approximately 800 billion yuan in funds.