PBOC Could Cut RRRs in Q1: Economist

The People’s Bank of China could make small cuts to the reserve requirement ratios in Q1 to achieve a desirable level of growth in credit and aggregate finance throughout the year, so as to meet the funding demand of expanded infrastructure investment, Lian Ping, the chief economist of Zhixin Investment Research Institute, wrote in an article published by news service Yicai.com. By Lian’s calculation, there could be about CNY1.3 trillion extra funds from local government special bonds to be invested in infrastructure projects this year when compared to 2021, which may create as much as CNY5.2 trillion social financing needs. Failing to meet these needs may reduce fiscal policy's pro-growth effect, Lian said.