Xinhua | October 18, 2024
China's central bank is considering a cut of 0.25 to 0.5 percentage points in reserve requirement ratio at an appropriate time before the end of 2024, depending on market liquidity situations, Pan Gongsheng, governor of the People's Bank of China, said on Friday.
The central bank is also considering reducing the interest rate of seven-day reverse repos by 0.2 percentage points and lowering the medium-term lending facility (MLF) interest rate by 0.3 percentage points, Pan stated at the Annual Conference of Financial Street Forum 2024.
China has recently introduced a package of financial measures to support the economy, and these policy moves have received positive feedback from both home and abroad, according to Pan. He added that these policies have bolstered social confidence and contributed to the stable operation of the economy and financial markets.
The reserve requirement ratio was cut by 0.5 percentage points in late September. Major state-owned commercial banks announced reductions in deposit interest rates on Friday morning. The loan prime rate (LPR), which will be released on October 21, is expected to move downward by 0.2 to 0.25 percentage points, according to Pan.
The recent cut in mortgage rates for existing home loans is expected to benefit 50 million households and reduce total interest expenses for households by approximately 150 billion yuan (about 21.05 billion U.S. dollars) per year, Pan said.