By The Telegraph (World News) | Created at 2024-09-24 06:30:37 | Updated at 2024-09-30 09:25:37
6 days ago
China has unveiled some of its most dramatic measures in years aimed at stimulating its faltering economy as leader Xi Jinping fears it could miss its 5pc growth target.
Commercial interest rates have been cut and banks have been freed up to hold less cash reserves amid a prolonged property sector debt crisis and high youth unemployment.
Pan Gongsheng, the Governor of the People’s Bank of China, told a news conference in Beijing that it would cut a slew of rates in a bid to boost growth, pledging to “promote the expansion of consumption and investment”.
Asian stocks rose on Tuesday to their highest in more than two and half years following the measures, which will see the central bank reduce interest rates on its loans to commercial banks, cut the down payment requirement on purchases of second homes to 15pc from 25pc and cut to the reserve requirement ratio (RRR), which dictates the amount of cash banks must hold in reserve.
The latter move will inject around a trillion yuan (£106bn) in “long-term liquidity” into the financial market, Mr Pan said.
Recently, Chinese leader Xi Jinping urged officials to do more to get growth back on track.
China’s economy grew at a 4.7pc annual rate in the last quarter after expanding 5.3pc in the first three months of the year.
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