Shares open lower Monday following RRR hike
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Chinese shares opened lower Monday, the first trading day following the central bank's announcement Friday to further hike reserve requirement ratio (RRR) for commercial banks.
The benchmark Shanghai Composite Index opened 0.46 percent lower at 2,886.54.
The Shenzhen Component Index opened 0.69 percent lower to 12,526.25.
The People's Bank of China (PBOC), the central bank, announced Friday that it would increase the bank reserve requirement ratio of 50 basis points beginning Feb. 24.
The hike, the second this year and the eighth since the beginning of last year, is the latest move to soak up liquidity and check inflation.
The central bank move, which came only 9 days after the latest interest rate increase, means major banks will have to set aside 19.5 percent of their reserves while small and medium-sized banks will have to keep 16 percent of their deposits in reserves.
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