China cuts interest rates and required reserves

Wed, Oct 8 2008, 11:28 GMT
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BEIJING, Oct 8 (Reuters) - China's central bank, acting in coordination with other central banks around the world, cut banks' benchmark lending and deposit rates by 0.27 percentage point on Wednesday.

The cost of one-year bank loans will fall to 6.93 percent from 7.20 percent, while the benchmark one-year deposit rate falls to 3.87 percent from 4.14 percent, the People's Bank of China said.

The PBOC also cut the reserve requirement for all banks by 0.50 percentage point.

That lowers the requirement for big banks to 17.0 percent and for other banks to 16 percent.

The cut in lending rates takes effect on Thursday; the cut in reserve requirements goes into effect on Oct. 15, the bank said on its website, www.pbc.gov.cn.

The PBOC gave no reason for the easing, which was announced in conjunction with rate cuts by leading central banks around the world.

The central bank cut lending rates and smaller banks' reserve requirements on Sept. 15. (Reporting by Eadie Chen;Editing by Alan Wheatley) Keywords: CHINA ECONOMY/PBOC

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