China's central bank announced it was lowering the amount of cash that all financial institutions need to reserve starting on Monday. [Photo provided to China Daily]

China's central bank announced it was lowering the amount of cash that all financial institutions need to reserve starting on Monday.

The 1 percentage point cut in the reserve requirement ratio (RRR) is expected to release liquidity of at least 1.2 trillion yuan ($197 billion) to support economic growth.

It is the second RRR cut in three months, and the biggest slash since November 2008.

The move also includes an extra 1 percentage point cut in the ratio to commercial banks for agricultural services and a further cut by 0.5 percentage points to eligible banks that lend a certain amount of money to agricultural borrowers or to small and micro businesses, according to the People's Bank of China.

As the cut is the most talked-about policy move in the Chinese market, here is a selection of quotes from international media.

"China's central bank on Sunday cut the amount of cash that banks must hold as reserves, the second industry-wide cut in two months, adding more liquidity to the world's second-biggest economy to help spur bank lending and combat slowing growth."

China makes big cut in bank reserve requirement to fight slowdown

-Reuters, April 19

"…the last RRR cut was seen as more defensive by some economists, as it served primarily to offset increasing capital outflows that were exerting a drain on the money supply, making it difficult to guide real lending rates down."

China's central bank cuts reserve ratio

-Guardian, April 19

"China has already cut benchmark interest rates twice and lowered the RRR once since November. The size of the latest reduction to 18.5 per cent exceeds analyst expectations for a 50 basis point cut sometime this month, after first-quarter growth slipped to 7 per cent, held back by a slowdown in construction and manufacturing."

Beijing moves again to boost growth

-Financial Times, April 19

"… In combination, the policies could help direct more of the new lending into productive sectors of the economy, while reducing the chance that the money further fuels the stock market."

China Frees Up $200 Billion for Lending

-International New York Times, April 19