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PBOC Hikes Reserve Ratio 50 Bps to 16.50% |
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Asian Economy |
Written by CEP News |
May 12 08 11:29 GMT |
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(CEP News) - In an effort to strengthen inter-bank lending and liquidity, the People's Bank of China hiked the reserve ratio to 16.5%, 50 bps above the previous 16.0% level.
This is the fourth time in 2008 that the PBOC has increased the reserve ratio, bringing a total of 550 bps in hikes to the minimum reserves required to be held in a commercial bank's vault. The announcement also comes after an annual 8.5% increase in consumer prices in April. In March, CPI picked up 8.3%. The new reserve requirement will begin May 20. By Erik Kevin Franco,
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