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Banking

People's Bank of China increases bank deposit reserve ratio by 50 basis points.

People's Bank of China increases bank deposit reserve ratio by 50 basis points. According to People's Daily , the People's Bank of China announced on last Friday that the deposit reserve ratio of banks would be increased by 0.5 pps with effect from Nov. 15. This increase will not apply to rural cooperative banks and credit cooperatives. The central bank had already raised the bank deposit reserve ratio by 0.5 pps; each in July and August. The latest increase will amount to a total hike of 1.5 pps in the current year. With this decision, banks will be required to deposit 9% of their reserves with the central bank. The hike is part of the central bank's efforts to improve the liquidity management of commercial banks and to ensure the stable growth of money and credit, and to promote all-round economic development.

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