RRR hike to reduce liquidity by 10-15%

Recent moves by the central bank to slightly tighten the reserve requirement ratio (RRR) of banks is likely to pull down the growth of the country’s money supply, according to local analysts.

In the May issue of their Capital Markets Research alliance’s publication, The Market Call, financial firm First Metro Investments Corp. (FMIC) and the University of Asia and the Pacific (UA&P) said that the hike in the banks’ RRR will mop up excess domestic liquidity by the third quarter of this year.