Ever since Wen Jiabao, China’s premier, promised in October to “preemptively fine-tune policy at a suitable time and by an appropriate degree” markets have been waiting for monetary easing to begin.
In fact it is already under way, in the form of increased lending from China’s state-owned commercial banks and in sharp falls in China’s money market rates. But on Wednesday came the first sign of a lifting of reserve requirements. It has begun with rural banks. More will follow.