China said Wednesday it would cut a key interest rate and lower the amount banks must hold in reserve, as officials look to kickstart the economy, which has been hit by low consumption and the trade war with the United States.
“The reserve requirement ratio will be cut by 0.5 percentage points,” China’s central bank chief Pan Gongsheng told a news conference.
Beijing will also lower its seven-day reverse repurchase rate to 1.4 percent from 1.5 percent, he added.
Pan said Beijing’s policies aimed “to support technological innovation, boost consumption, and promote inclusive finance, among other areas”.
The world’s second-largest economy has struggled to fully recover since the Covid-19 pandemic and is also grappling with sluggish domestic demand and a protracted property sector crisis.
And economists have warned that the disruption in trade between the tightly integrated US and Chinese economies could threaten businesses, increase prices for consumers and cause a global recession.
Beijing last month blamed a “sharp shift” in the global economy for a slump in manufacturing.
Exports soared more than 12 percent in March as businesses rushed to get ahead of US President Donald Trump’s swingeing tariffs.