The Peoples Bank of China (PBOC) is expected to cut
the reserve requirement ratio (RRR) for smaller banks before
the end of this year.
Chinas central bank last month ordered all commercial
banks to include margin deposits in required reserves in a bid
to tighten the shadow banking system, as well as to rein in
ever-rising inflation and address concerns over local
government entities risk exposure.
According to the PBOC, renminbi margin deposits - such as
letters of credit, bank acceptances and letters of guarantee -
totalled Rmb4.4 billion ($689bn) at the end of July, making up
5.7 percent of...