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During the last week in August, the People’s Bank of China drew the attention of traders worldwide by cutting the benchmark lending rate 0.25 percentage point to 4.6%.

The People’s Bank of China reformed the exchange rate formation system on August 11 to better reflect market development in the exchange rate of the Chinese yuan against the US dollar.

China’s central bank today (Aug 25) cut interest rates and lowered the amount of reserves the country’s banks must hold, cranking up support for a stuttering economy and a plummeting stock market that has sent shockwaves around the globe.

US stocks initially posted their sharpest rally of the year in Tuesday morning trading after investors looked for bargains a day after Wall Street’s worst performance in four years.

The People’s Bank of China, the country’s central bank, on Tuesday morning moved to devalue its tightly controlled currency, the Yuan, following weaker than expected Chinese import and Export data over the weekend.

A cheaper yuan will help Chinese exports by making them less expensive on overseas markets.

In addition, the PBOC is reducing the reserve requirements (RRR) for most big banks from 18.5 percent to 18.0 percent.

It also increased the amount of money available for lending by reducing the minimum reserves banks are required to hold by 0.5%.

China has sought to calm its panic-stricken stock markets by cutting interest rates and loosening constraints on bank lending after a second day of plunging share prices.

“Given the sufficient forex reserves with the RBI, the central bank will not allow the continuous slide in rupee’s value”.

“The markets’ response to Chinese surprise devaluation of its currency against the US dollar is ample evidence that investors worry about further measures across Asian countries in order to prop up export competitiveness”, said Anand James, the co-head of the...

Discussions of economic issues in policy circles often suffer from a “which way is up?” dilemma; it’s not clear what the problem is that needs to be solved.

Zhang says there used to be a 3-percent gap accumulated between the official rate and market expectations.

China’s central bank on Friday raised the yuan currency against the US dollar by 0.05%, the national foreign exchange market said, ending three days of falls after a surprise devaluation.

“The central bank has the ability to keep the renminbi basically stable at a reasonable and balanced level”, she said.