Follow-up – WAA
The head of China’s central bank announced Tuesday that Beijing will take measures to stimulate the economy, most notably reducing the reserve requirement that banks must hold and lowering the benchmark lending interest rate..
“The Chinese authorities will cut the reserve requirement ratio and the key interest rate, and will lower the benchmark interest rate in the market,” Pan Gongsheng said.“.
He added that “the reserve requirement ratio will be cut very soon by 0.5 percentage points in order to provide the financial market with long-term liquidity of about 1,000 billion yuan” (128 billion euros)..
The central bank chief also announced that China will also “cut interest rates on existing mortgage loans and unify down payment ratios for mortgage loans.”
He explained that this matter “will push commercial banks to reduce interest rates on existing real estate loans to a level close to the interest rates on newly issued loans.”“.
More than a year and a half after the lifting of health restrictions imposed by the authorities to combat the Covid pandemic, which had disastrous repercussions on the country’s economy, the pace of economic recovery is still slower than expected..
Source: AFP