China raises bank reserves for fourth time this year

China's central bank has raised the amount of money that lenders must hold in reserve for the fourth time this year, as it battles rising inflation.

By insisting banks hold more cash, the central bank hopes to restrict lending, which in turn will reduce spending.

The latest move, raising the required reserve ratio from 20% to a record 20.5%, is expected to lock up about 350bn yuan ($54bn; £33bn) that banks would otherwise be able to lend.

Inflation in China hit 5.4% in March.

Rising food prices have been the main cause, with the cost of food up 11.7% in the year to March. Housing costs have also risen sharply.

The central bank has also raised interest rates four times since October as it tries to curb inflation.

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