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China Raises Requirement Ratio
Oct 14, 2007 04:03
  • DREAMLIFE
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China's official news agency Xinhua Agency says China will raise the reserve requirement ratio by half a percentage point to 13 percent for commercial banks from October 25, the People's Bank of China (PBOC) announced on Saturday.

This is the eighth such move this year and only one month after the seventh hike of half a percentage point on September 25.

The move is aimed at "strengthening liquidity management in the banking system and checking excessive credit growth", the central bank said in a statement.

After the eighth rise, the reserve requirement ratio has reached a ten-year high.

Does it sound a piece of good news for average Chinese? Who are the real beneficiaries of this move? What are your opinions?

Oct 18, 2007 02:48
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  • ICEBERG
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The government should not only rely on raising reserve ratio to curb excess liquidity and credit growth. The rapid increase of the foreign exchange reserve attribute to the excess liquidity. We should find some ways to consume the huge reserve and lower its growth rate. To do investment in overseas market is a good choice.
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