SHANGHAI, Dec 29 (Reuters) - China's central bank on Friday said it is setting up a temporary liquidity facility that will let commercial banks have more cash available ahead of the coming Lunar New Year.
The facility would let banks temporarily keep fewer reserves with the People's Bank of China.
The central bank, in a statement on its website, said the move would fulfill commercial banks' temporary liquidity demand ahead of Lunar New Year to promote steady money market operations.
According to the statement, some banks will be allowed to lower their reserve requirement ratios by up to 2 percentage points, for 30 days.
Traditionally, there's great demand in China for cash ahead of Lunar New Year.
In 2018, the first day of Lunar New Year is Feb. 16. The PBOC statement did not specify when the temporary facility would begin operation. (Reporting by Beijing Monitoring Desk and Winni Zhou; Editing by Richard Borsuk)