China will use monetary policy tools including cuts in its bank reserve requirement ratio to support the real economy, especially small and medium-sized enterprises, the State Council said on Wednesday.
China will avoid “flood-like” stimulus and keep monetary policy stable and increasingly effective, the cabinet said, to lower financing costs for small and medium-sized businesses faced with rising commodity prices.
China’s central bank last cut its RRR in April 2020, unleashing about $56 billion to bolster the country’s pandemic-hit economy by slashing small banks’ reserve requirements.