China's Room for Further Economic Maneuvers

China has potential for additional reserve requirement ratio reductions as the average RRR is at 6.6%. The central bank focuses on maintaining stable economic growth by adjusting interest rates, increasing liquidity, and possibly using diverse monetary policy tools, according to a PBOC official.

China has the potential for further reductions in its reserve requirement ratio, with the average currently standing at 6.6%, a central bank official revealed, as reported by state broadcaster CCTV.

This week, China announced plans to raise its budget deficit, increase debt issuance, and loosen monetary policy to support stable economic growth.

The People's Bank of China (PBOC) has been gradually lowering interest rates and injecting liquidity to meet its growth target of around 5% for the year. PBOC official Wang Xin highlighted the need to enhance interest rate transmission to reduce social financing costs steadily.

Wang noted that as the central bank explores government bond transactions in the secondary market, it should employ diverse monetary tools to ensure ample medium and long-term liquidity in the banking sector.

(With inputs from agencies.)