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China cuts reserve requirements for rural banks

China will cut the amount of funds rural banks must keep in reserve by up to two percentage points, the central bank said Tuesday, easing monetary policy in a bid to boost its slowing economy. The announcement comes after the government said last week that gross domestic product grew 7.4 percent year-on-year in the first quarter, sharply down from 7.7 percent the previous three months owing to a slow global recovery as well as domestic structural reforms.

Mixed results at weekly US Treasury auction; Rates on 3-month bills slip

WASHINGTON - Interest rates on short-term Treasury bills were mixed in Monday's auction. Rates on three-month bills slipped and rates on six-month bills were unchanged. The Treasury Department auctioned $25 billion in three-month bills at a discount rate of 0.030 per cent, down from 0.035 per cent last week. Another $23 billion in six-month bills was auctioned at a discount rate of 0.050 per cent, unchanged from the auction of six-month bills last week.

China eases with reserve cut for rural banks

China will cut the amount of funds that rural banks must keep in reserve, state media said, in a small easing of monetary policy by the government as it tries to provide support to the slowing economy. The powerful State Council, China's cabinet, said it would allow a cut in the reserve requirements for some county-level commercial banks and cooperative banks in rural areas, the official Xinhua news agency said late Wednesday, but gave no details.

Fed's Fisher: QE3 taper should continue, end in fall

By Ann Saphir AUSTIN (Reuters) - The Federal Reserve will continue to trim its massive bond-buying program and end it this fall, a top Fed official predicted on Wednesday, adding that interest rates will stay near zero until at least then and probably some time beyond. "I cannot foresee any reason to not continue to reduce it to zero," Dallas Federal Reserve Bank President Richard Fisher told reporters after an event.

Fed should try to align projections with policy statement: Lockhart

ATLANTA (Reuters) - The U.S. Federal Reserve should try to make its communications on the expected path of interest rates more consistent with its policy statements, a top official at the central bank said on Wednesday. Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, said the Fed's most recent projections for interest rates had been out of step with its pledges on policy. "It seemed to be inconsistent with the underlying decision of the committee and the underlying guidance," Lockhart told reporters in Atlanta.

New Zealand inflation surprises on downside

New Zealand's inflation rate rose just 0.3 percent quarter-on-quarter in January-March but the lower than expected figure is unlikely to stop the central bank raising interest rates again, analysts said Wednesday. Statistics New Zealand said the rise, largely driven by an increase in tobacco tax and surging house prices, put the annual inflation rate at 1.5 percent, well within the central bank's 1.0-3.0 target.

U.S. urges Japan possibly take more fiscal steps to counter slowdown

The U.S. Treasury Department on Tuesday called on Japan to take additional fiscal steps if the economy slows more than anticipated following the 3-percentage-point hike in the consumption tax on April 1. In its Report to Congress on International Economic and Exchange Rate Policies, the department said Japanese authorities plan to accelerate regular budgetary spending "but should be prepared to provide additional fiscal support if growth slows more than authorities forecast."

Fed's Kocherlakota to 'do what it takes' on U.S. inflation

FARGO, North Dakota (Reuters) - A top U.S. Federal Reserve official said on Tuesday he will "do what it takes" to get inflation to be around 2 percent, including raising rates sharply if prices unexpectedly start to spiral upward too quickly. But Minneapolis Federal Reserve Bank President Narayana Kocherlakota, speaking at a town hall at North Dakota State University, made it clear that he does not anticipate such a scenario.

U.S. Fed falling short on inflation and job goals, Kocherlakota says

FARGO, North Dakota (Reuters) - The U.S. Federal Reserve is coming up short on its goals for both inflation and employment, a top Fed official said on Tuesday, and the central bank ought to do more to ensure they return to healthier levels. Inflation is "well below" the Fed's 2-percent goal, and looks likely to remain there for several more years, Minneapolis Federal Reserve Bank President Narayana Kocherlakota said in brief remarks prepared for delivery to a town hall in Fargo, North Dakota.

China M2 growth normal level, liquidity ample to support economy: central bank

BEIJING (Reuters) - Money supply growth in China remains at a reasonable level and total liquidity is ample enough to meet the needs of the real economy, a senior official at the central bank said in remarks published by the official Xinhua news agency on Tuesday. Sheng Songcheng, the head of the statistics department of the People's Bank of China, also projected M2 growth, a broad measure of money supply, at around 13 percent for this year.
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