China's central bank has pledged to increase liquidity to support the economy. The People’s Bank of China said in an interview with the official Xinhua news agency that it will increase reverse repo operations and cut the reserve requirement ratio at an appropriate time to release liquidity.
The central bank said it will take comprehensive and effective measures to make pre-emptive policy adjustments, also at an appropriate pace, so as to guide steady growth in money and credit supply, to keep banking system liquidity at a reasonable level and to support stable and relatively fast economic growth.
The remarks come after China’s bank lending surged in March to over 1 trillion yuan, the biggest credit extension since January 2011. No indication, however, of when exactly these moves might come.