China – High RRR a block to liberalising interest rates says researcher

Peng Xingyun, a researcher with the Chinese Academy of Social Sciences, quoted in the Shanghai Securities News (via MNI):

• A high reserve ratio is a block to liberalizing interest rates
• It adds to bank costs and forces them to raise lending rates
• Says conditions are ripe to lower reserve ratio over the medium-term
• Also that the PBOC should remove the floor on mortgage rates

(Earlier – headline only – is here)

Also from earlier:

• RRR is reserve requirement ratio.
• A cut would be a positive input for the Australian dollar