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Ahead of Chinese New Year, central bank lets loose $115bn

China lowers reserve rate to avoid cash crunch

As China prepares to ring in the Year of the Rat, travelers are on high alert for symptoms of a pneumonia virus that has spread in the city of Wuhan, a major transport hub. Nearly 3 billion passenger trips were made during last year's holidays.   © Reuters

BEIJING -- China's central bank will lower the level of cash reserves that commercial lenders are required to maintain, hoping to stimulate loans to small businesses and avert any cash crunch during the Lunar New Year in late January.

The 0.5 percentage-point cut to the required reserve ratio for big banks, effective Monday, will lower the rate to 12.5% in the first reduction since September.

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