On May 7, 2025, the People’s Bank of China (PBOC), under Governor Pan Gongsheng, announced a series of significant monetary policy adjustments to support economic growth amidst global and domestic pressures. The key changes include lowering the deposit reserve ratio by 0.5 percentage points, releasing an expected 1 trillion yuan in liquidity into the market, and implementing several rate cuts. These adjustments aim to alleviate borrowing costs for businesses and individuals, stimulating investment and consumer spending. 1.4% interest rate reduction on the 7-day reverse repurchase operation is one of the notable changes, further lowering mortgage rates for first-time homebuyers. Governor Pan Gongsheng stated that these policy adjustments are intended to implement a ‘moderately loose’ monetary policy with a focus on supporting the real economy. The impact of these measures has been closely watched as part of a larger effort to counter recent economic challenges. Analysts view these changes as indicative of the PBOC’s commitment to a ‘moderately loose monetary policy’ and highlight their potential for boosting investment in technology and innovation sectors. The move is significant, given China’s last major reserve requirement ratio adjustment occurred in 2018, demonstrating the urgency of current measures in response to external economic factors. The historical precedent suggests that such monetary easing measures often play a vital role in stabilizing economies during downturns,