Chinese media: The People's Bank of China plans to reduce the reserve requirement ratio again this year.

On Tuesday morning, a Chinese state-affiliated media outlet published a report stating that the People's Bank of China (PBOC) intends to implement further reductions in the reserve requirement ratio (RRR) this year.

The China Securities Journal quoted some economic experts in China as saying that the PBOC will take this additional step as part of a massive economic stimulus package aimed at supporting the struggling economy and stimulating domestic demand.

It is worth noting that the reserve requirement ratio (RRR) is a regulation by the central bank that determines the minimum reserves that each bank must hold against its deposit liabilities.

The RRR is the percentage of total deposits that banks are legally required to keep on hand, either in cash in their vaults or in a reserve account at the central bank.

In China, this ratio is set by the People's Bank of China, and by adjusting the reserve requirement ratio, the PBOC can influence the lending capacity of commercial banks.

For example, an increase in the reserve requirement ratio means that banks will have less money to lend since they are required to hold more in reserve, which reduces the money supply in the economy. Conversely, if the PBOC lowers the reserve requirement ratio, banks will have more money to lend since they are obligated to hold a smaller percentage in reserve, leading to an increase in the money supply in the economy, which may stimulate economic activity.