By Jiahui Huang

Chinese shares on Friday could see their highest close this year on hopes that Beijing will soon move to shore up the economy.

There is speculation that the People's Bank of China could move to ease liquidity in the Chinese banking system before the weekend. "The gains could be driven by a possible reserve requirement ratio cut today," ANZ Research's senior China analyst Zhaopeng Xing said.

The PBOC last lowered the RRR--which determines how much banks have to hold in reserves--in September, allowing banks to lend more and sending more liquidity into the system.

Market sentiment was also helped by hopes that policies to boost consumption could be announced at a press conference held by key Chinese policymakers on Monday. The country's economic growth plan for the year, unveiled earlier this month at the so-called "Two Sessions" meeting, revealed that boosting consumption was a top priority for the government.

Monday's press conference will involve the National Development and Reform Commission, the Ministry of Finance, the Ministry of Human Resources and Social Security, the Ministry of Commerce, the People's Bank of China and the state market regulators.

The benchmark Shanghai Composite Index was 1.65% higher at 3413.98 at midday Friday, on track to its highest close level since December last year. In Hong Kong, the benchmark Hang Seng Index tracked the mainland and was last up 2.3% at 23999.92 while the Hang Seng Tech Index also gained 2.3%.

Liquor, brokerage and insurance stocks led gains on CSI300 index. New China Life Insurance was up 10% and Luzhou Laojiao Company gained 6.5% while Wuliangye Yibin rose 6.2% and Cinda Securities surged 10%.

Write to Jiahui Huang at jiahui.huang@wsj.com

(END) Dow Jones Newswires

March 14, 2025 01:39 ET (05:39 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.