Stocks Shoot Up After Shock Chinese Rate Cut—And This One Is A Big Deal

people's bank of china, China central bank

Photo: AP Images

China cut benchmark interest rates by 25 basis points.You hear a lot about Chinese rate cuts, but this is a different one.

Most rate cuts are cuts to the reserve requirement ratio, which is a modest move.

This time it’s the first straight up rate cut since 2008.

Futures are ripping higher on the news…

But this is a sign that growth is not happening at the pace that Beijing is looking for.

It will also let banks offer a 20% discount from the benchmark rate.

The news came out right at 7:00 AM ET, right when the Bank of England made its rate announcement. It did nothing.

The PBOC move continues the theme for the week: Central bank activity. The big show is later today when Bernanke speaks on the hill.

Click here to see 6 signs that Chinese growth is already stabilizing >

WATCH: What Today’s Shock Chinese Rate Cut Really Means

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at

Tagged In

china moneygame-us