China's central bank said Friday that it will cut the amount of cash that banks must hold as reserves, in an attempt to ease credit and shore up the economy hit by rising global material prices.
The reduction of the reserve requirement ratio by the People's Bank of China is aimed at prompting financial institutions to lend more money to companies and other entities to boost consumption and domestic investment.
The reserve requirement ratio for all lenders will be lowered by 0.5 percentage point to 8.9 percent on Thursday.
On Wednesday, a State Council executive meeting chaired by Premier Li Keqiang decided that China will increase financial support for the real economy, especially micro, small and medium-sized enterprises, the official Xinhua News Agency reported.
