Chinese Banks Told to Set Aside More Cash

For the fifth time this year, the People's Bank of China raised banks' reserve requirements 0.5 percentage point from May 18, boosting levels for the nation's biggest lenders to a record 21 percent, reports the South China Morning Post.

 

The increase followed reports showing inflation and lending exceeded economists' estimates in April, with prices rising more than 5 percent for a second month, says the newspaper.

 

Beijing has also accelerated gains in the yuan, which broke 6.5 per dollar for the first time since 1993 on April 29. A stronger yuan helps to reduce import costs, notes the Post.

 

 

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