BEIJING: China’s central bank on Friday cut its benchmark interest rates and the amount of cash banks must keep on hand, the latest stimulus aimed at boosting the world’s second-largest economy.
The People’s Bank of China (PBoC) announced on its website that it was reducing lending and deposit interest rates by 0.25 percentage points each and its reserve requirement ratio by 0.50 percentage points.
The move comes just before the opening of a top level meeting of the ruling Communist Party, known as the Fifth Plenum, which will focus on finalizing the 13th Five Year Plan for the economy, beginning next year.
The central bank announced similar tandem cuts in August when the economy was battling a collapse in share prices.
The PBoC has now cut benchmark interest rates six times since November as authorities try to head off a sharp deceleration of the economy, which saw growth in the third semester slip to 6.9 percent, the lowest level since 2009.
Reducing the RRR is also a stimulatory measure as it increases the amount of money banks can lend out, so can boost economic activity.