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.4 ]; N, k6 N2 E7 }! f2 B
According to Bank Communication Analyst E Yongjian, the current situation does not allow for a higher interest rate, so the rises in reserve requirement are necessary. The increase could be implemented in four separate rises of 0.5 percentage points each, the newspaper reported.1 B m: k) q) ~
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.
$ i4 ]3 { Z" b 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.
0 l4 k& s0 e, E7 B. ? 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. |