Chinese central bank raises reserve ratio by 50 basis points

BEIJING - China’s central bank on Monday ordered major commercial banks to set aside more money in reserves in an effort to slow the nation’s economy, the sixth such cooling measure this year.

By (AFP)

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Published: Mon 30 Jul 2007, 6:38 PM

Last updated: Sat 4 Apr 2015, 10:23 PM

The People’s Bank of China said in a statement the action was designed to enhance bank liquidity management and prevent excessively fast credit growth.

It said the required deposit reserve ratio for most commercial lenders would on August 15 rise 0.5 percentage points to 12 percent.

Beijing is struggling to put the brakes on the world’s fourth-largest economy, reining in a boom that is to a large extent liquidity-driven.

China last month announced this year’s third interest rate hike, after the economy expanded by 11.9 percent in the second quarter and 11.5 percent for the first six months of the year, a pace not seen since the mid-1990s.

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