Chinese Central Bank Cuts Rates Again To Stimulate Economy

(RTTNews) - Chinese central bank announced further reduction of interest rates, its fourth move in around seven months, in a bid to boost economic growth, according to a statement on Saturday.

The bank cut one-year deposit rate by 25 basis points to 2 percent, while one-year benchmark lending rates were lowered by 25 basis points to 4.85 percent. The new rates will come into effect on Sunday.

The reserve requirement ratio for banks with sizable lending to farmers and small businesses has been cut by 50 basis points.

The move marks fourth round of interest rate reduction since the bank began its easing cycle in November. On May 10, the bank lowered one-year benchmark lending rates and deposit rates by 25 basis points each, to 5.1 percent and 2.25 percent, respectively.

In a statement, the bank noted that the interest rate and RRR cuts could help stabilise growth, adjust structures and lower social financing costs.

"The central bank will continue to implement prudent monetary policy, use various policy tools to strengthen and improve marco-prudential management, optimise policy combinations and create neutral and appropriate monetary and financial environments for economic adjustments and upgrading," it added.

In June, the PBOC had lowered its economic growth target to 7 percent in 2015, from 7.4 percent last year.