The PBoC Governor today announced his intention to cut the reserve requirement ratio (RRR) by 50 basis points on 5 February, reinforcing optimism in the Chinese market after the recent sell-off. The weighted rate before the cut was 7.40%. In effect, this will free up 1 trillion yuan in the economy.
Chinese indices are clearly gaining during today's session. Source: xStation
Moreover, the gains are mainly the results of the unwinding of the recent dynamic declines and yesterday's comments by the Chinese establishment, which announced that it intends to use around $300 billion from the foreign accounts of state-controlled listed companies to support the current troubled stock market.
HK.cash contracts are gaining dynamically and are currently testing the limit set by the 100-period exponential moving average on the H4 interval.Source: xStation
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