China’s central bank cut its benchmark lending rate and reserve requirements for banks, stepping up efforts to cushion a deepening economic slowdown.
The one-year lending rate will drop to 4.35 percent from 4.6 percent effective Saturday the People’s Bank of China said on its website on Friday. The one-year deposit rate will fall to 1.5 percent from 1.75 percent.
Reserve requirements for all banks were cut by 50 basis points, with an extra 50 basis point reduction for some institutions. The PBOC also scrapped a deposit-rate ceiling.
The expanded monetary easing underscores the government’s determination to meet its 2015 growth target of about 7 percent. Moderated consumer inflation and a deeper slump in producer prices have given policy makers room for further easing.