BEIJING, Jan. 14 (Xinhua) -- The People's Bank of China (PBOC), or the central bank, said Friday that it would lift the banks' reserve requirement ratio by 50 basis points as of Jan. 20.
After the hike, Chinese major banks will have to set aside 19 percent of their reserves and small and medium banks will have to keep 15.5 percent of their deposits as reserve, a record high for the country's deposit-taking institutions.
According to the PBOC's latest figures, the reserve ratio hike will tighten another 350 billion yuan (53.1 billion U.S. dollars) of banks liquidity as the outstanding yuan-denominated deposits in China stood at 71.82 trillion yuan (10.9 trillion U.S. dollars) by the end of 2010.
It was the PBOC's first move in 2011 to tighten excessive liquidity in the market amid mounting inflationary pressure.
The PBOC had raised the banks' reserve ratio for sixth times last year to rein in accelerating inflation, as China's consumer price index (CPI), a main gauge of inflation, hit 5.1 percent in November 2010, the highest in 28 months.
China to increase yuan flexibility, further open up financial markets
BEIJING, Jan. 14 (Xinhua) -- China will increase the flexibility of the yuan exchange rate and further push forward the opening-up of its financial markets, a senior central bank official said Friday.
China will continue the reform of the yuan exchange rate mechanism and keep the rate basically stable at a reasonable and balanced level, Li Dongrong, assistant governor of the People's Bank of China, said at a forum. The speech was posted on the central bank's website. Full story
China's GDP growth forecast to slow down: WB
BEIJING, Jan. 14 (Xinhuanet) --The country's GDP growth rate will slow to 8.7 percent this year from 10 percent in 2010, and a key challenge in 2011 will be to ensure that anti-inflationary measures do not "significantly" reduce growth, the World Bank said on Thursday.
The bank estimates that global GDP, which expanded by 3.9 percent in 2010, will slow to 3.3 percent in 2011, before reaching 3.6 percent in 2012. Developing countries will continue to outstrip growth in developed countries, it said. Full story
Video: Chinese banks overshot new loan target