deposit reserve ratio

It is reported that the People’s Bank of China has decided to reduce the deposit reserve ratio of financial institutions by 0.25 percentage points on March 27, 2023 (excluding financial institutions that have implemented a 5% deposit reserve ratio). After this reduction, the weighted average deposit reserve ratio of financial institutions is about 7.6%. The People’s Bank of China has decided to reduce the deposit reserve ratio of financial institutions on March 27, 2023 Analysis based on this information:The People’s Bank of China has made the decision to lower the deposit reserve ratio of financial institutions by 0.25 percentage points, effective March 27, 2023. This move is anticipated to boost lending and stimulate economic growth in the country. However, financial institutions that have already implemented a 5% deposit reserve ratio are excluded from this reduction, so their ratio will remain the same. The deposit reserve ratio is the percentage of customer deposits that a bank must hold in reserve and…