Required reserves ratio may rise: Experts
Updated: 2011-01-12 15:40
By Hao Yan (chinadaily.com.cn)
Banking experts said the central bank may raise Chinese commercial banks' required reserve ratio to tame surging domestic liquidity and inflation, China Securities Journal reported Wednesday.
Agricultural Bank of China representatives predicted the required reserve ratio could increase by 150 to 250 basis points in total, in three to five separate rises, the report said.
Some experts say the required reserve ratio may be raised slightly as hikes in interest rates are still necessary to relieve pressure caused by inflation.
In December 2010, the M2 increased 19.7 percent year-on-year, and the new yuan-denominated lending increased by 480.7 billion yuan, driving new loan totals last year to 7.95 trillion yuan, according to data from the People's Bank of China.
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