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The post <a href="https://coinpedia.org/news/peoples-bank-of-china-rrr-cut-expected-to-boost-bitcoin/" rel="noopener noreferrer nofollow">People’s Bank of China RRR Cut Expected To Boost Bitcoin</a> appeared first on <a href="https://coinpedia.org" rel="noopener noreferrer nofollow">Coinpedia Fintech News</a>
The People’s Bank of China (PBoC) has announced a 50 basis points cut to the Reserve Requirement Ratio (RRR), to provide support for risk assets, including cryptocurrencies. The unexpected decision follows the Chinese government’s proposal of a $278 billion package to strengthen the country’s stock markets.
Details and Reasons
<a href="https://t.me/QCPbroadcast/1122" rel="noopener noreferrer nofollow">QCP Market Update </a>suggests that this move by the PBoC might provide support for risk assets, especially in the crypto space. The announcement also highlighted the potential impact of the US Treasury issuing more short-term debt, aligning with expectations that could further bolster risk assets and crypto.
The PBoC’s transparent reveal of the RRR cut (which in itself is a rare occurrence), comes amidst economic concerns and a significant stock market downturn.&nbsp;
Governor Pan Gongsheng stated that the move, scheduled for February 5, aims to inject 1 trillion Yuan – equivalent to $139 billion – in long-term liquidity into the market. It is believed that this strategic move will stabilize the economy and counter a $6 trillion stock-market rout.
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The <a href="https://www.bloomberg.com/news/articles/2024-01-25/asml-s-china-sales-surged-despite-secret-dutch-deal-with-us" rel="noopener noreferrer nofollow">announcement</a> triggered positive movements, with Chinese equities rising by 7-8% from recent lows, thereby providing the necessary support to various risk assets, including the crypto market. The PBoC’s measures also include interest rate reductions on re-lending funds to incentivize loans for agriculture and small businesses.
Market analysts are closely monitoring the upcoming FOMC meeting on January 31 and the Quarterly Refunding Announcement by the US Treasury. The expectation is that these events will provide insights into the pace of the balance sheet runoff and potential actions that may further influence risk assets and cryptocurrency markets globally.

People’s Bank of China RRR Cut Expected To Boost Bitcoin

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