BEIGING: The People’s Bank of China has said that it will raise the banks’ reserve requirement ratio by 50 basis points from Jan 20.
After this hike, the major banks will have to set aside 19 percent of their reserves and small and medium banks will have to keep 15.5 percent of their deposits as reserve, a record high for the country’s deposit-taking institutions, China Daily reported Friday.
According to the central bank’s latest figures, the reserve ratio hike will tighten another 350 billion yuan ($53.1 billion) of banks liquidity. The outstanding yuan-denominated deposits in China stood at 71.82 trillion yuan ($10.9 trillion) by the end of 2010.
It was the central bank’s first move in 2011 to tighten excessive liquidity in the market amid mounting inflationary pressure.
The bank had raised the reserve ratio for sixth times last year to rein in inflation, as China’s consumer price index (CPI), a main gauge of inflation, hit 5.1 percent in November 2010, the highest in 28 months.
Dear TNT Reader,
At The News Tribe, our mission is to bring you free, independent, and unbiased news and content that keeps you informed and empowered. We are committed to upholding the highest standards of journalism, as we understand that we are a platform for truth.
Apart from independent global news coverage, we also commit our unique focus on the Muslim world. In an age marked by the troubling rise of Islamophobia and widespread misrepresentation of Muslims in Western media, we strive to provide accurate and fair coverage.
But to continue doing so, we need your support. Even a small donation of 1$ can make a big difference. Your contribution will help us maintain the quality of our news and counteract the negative narratives that are so prevalent.
Please consider donating today to ensure we can keep delivering the news that matters. Together, we can make a positive impact on the world, and work towards a more inclusive, informed global society.
Donate Monthly Subscription Annual Subscription