BEIJING, Sept. 16 (Xinhua) -- China's central bank has injected more money into the market as a lower reserve requirement ratio (RRR) for financial institutions goes into effect on Monday.
About 800 billion yuan (about 113.2 billion U.S. dollars) of long-term capital was released as the People's Bank of China (PBOC) began to implement the reduction of the RRR for financial institutions by 50 basis points.
The second broad-based RRR cut of this year, the move was announced earlier this month with an aim to support the real economy and reduce the real cost of social financing.
The central bank also announced an additional reduction of 100 basis points in the RRR for city commercial banks operating only in provincial administrative areas, which will be implemented in two phases, on Oct. 15 and Nov. 15, cutting 50 basis points in each phase.
The RRR cuts can release liquidity, increasing the sources of funds for financial institutions to support the real economy and reducing the annual capital cost of banks by about 15 billion yuan, said the PBOC.
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