The People's Bank of China (PBOC) increased the reserve requirement ratio – the proportion of deposits commercial banks must hold in cash – on Thursday for the seventh time so far this year. The half-point rise in the reserve ratio to 12.5% was accompanied by the special sale of three-year bonds to certain banks, Reuters reported. These moves are expected to remove about US$44 billion from the economy that banks would otherwise have been able to lend to customers. The PBOC said it was taking action to "strengthen liquidity management in the banking system and curb overly fast growth in credit." It has also raised interest rates four times so far this year. The reserve ratio hike was widely expected by economists as China's export-led growth continues to flood the country with cash, generating possible asset bubbles. The Shanghai stock market rose 1.56% on Thursday to a new record high of 5,393.66.