The central bank's action came after a global stock market rout in which China's markets led the declines. The main Shanghai share index plunged another 7.6 percent on Tuesday, to its lowest level this year. That brought its three-day decline to 22 percent and signaled that two months' worth of attempts by the government to prop up stock prices had limited effects.
In an aggressive two-part move on Tuesday, the central bank lowered the benchmark lending and deposit rates by 0.25 of a percentage point. It also cut the so-called reserve requirement ratio for the amount of cash that banks are required to hold in reserve by 0.5 of a percentage point. It was China's fifth interest rate cut since November, and the fourth reduction of the reserve ratio since February. The central bank made a similar tandem cut to both rates in June, when the stock market first began to fall from its peak, but that reduction of the reserve ratio did not apply to the biggest banks.'