China Cuts Bank Reserve Ratio By 50 Basis Points

[land118]

http://www.cnbc.com/id/45489423

China Cuts Bank Reserve Ratio By 50 Basis Points
Published: Wednesday, 30 Nov 2011 | 7:03 AM ET Text Size
By: Reuters

China's central bank cut the reserve requirement ratio for its commercial lenders on Wednesday for the first time in nearly three years to ease credit strains and shore up an economy running at its weakest pace since 2009.

The move comes amid increasing concern among policymakers worldwide that the global economy is on a slippery slope as the euro zone struggles to decisively tackle its two year debt crisis. Global markets recovered early losses on the news.

China's central bank said it lowered the reserve ratio by 50 basis points. That reduces the ratio for the biggest banks to 21 percent from a record high 21.5 percent, freeing up funds that could be used for lending to cash-strapped small firms.

"It's a surprising move—the market was not expecting the central bank to (cut RRR) so fast," said Shi Chenyu, an economist with the investment banking unit of Industrial and Commercial Bank of China.

"The move sends a clear message that the central bank is ready to relax its policy stance."

The central bank, which has already loosened credit curbs to help cash-starved small firms, has pledged to "fine-tune" policy if needed. The new level becomes effective on December 5, the central bank said in a short statement on its website.

Chinese banks have suffered a liquidity crunch in recent weeks after the central bank widened the base for calculating banks' reserve requirements by including their margin deposits.*

The 50-basis-point cut in the reserve ratio was the first since December 2008, marking a policy shift after a spate of tightening measures since last year aimed at fighting inflation, which hit a three-year peak in July of 6.5 percent.

However, inflation has since eased to 5.5 percent in October while economic growth has eased for three straight quarters due to tight credit at home and flagging demand overseas.

The economy grew 9.1 percent in the third quarter from a year earlier, its weakest pace since the second quarter of 2009.

[kane]

Wah, after so many rounds of tightening, they are finally relaxing.

[land118]

More joint action:

http://www.cnbc.com/id/45490416

Central Banks in Joint Action to Boost Liquidity to Markets
Published: Wednesday, 30 Nov 2011 | 9:30 AM ET Text Size
By: AP

Major central banks around the globe took coordinated action Wednesday to ease the strains on the world's financial system, saying they would make it easier for banks to get dollars if they need them. Stock markets and the euro rose sharply on the move.

The European Central Bank , U.S. Federal Reserve , the Bank of England and the central banks of Canada, Japan and Switzerland are all taking part.

[kane]

tonight really fried some of the weak bears.

[land118]

Mr B shouting DROP like "siao gao"in his thread...

But Central Banks all gang up together..., now ALL GREEN, still very volatile..

http://www.cnbc.com/id/45491598

Dow Spikes 400 After Central Bank Action
Published: Wednesday, 30 Nov 2011 | 10:26 AM ET

[sotidy]

Mr B shouting DROP like "siao gao"in his thread...

But Central Banks all gang up together..., now ALL GREEN, still very volatile..

http://www.cnbc.com/id/45491598

Dow Spikes 400 After Central Bank Action
Published: Wednesday, 30 Nov 2011 | 10:26 AM ET

Mr B seems to enjoy his thread very much. No doubt some of the information he posted are facts, he enjoys magnifying them. Really amaze at how fast that thread grew.

[kane]

Mr B seems to enjoy his thread very much. No doubt some of the information he posted are facts, he enjoys magnifying them. Really amaze at how fast that thread grew.

fastest growing thread in the record of this forum.