(Reuters) - China's central bank will cut banks' reserve requirement ratio by 50 basis points and further reduce key interest rates to support a recovery in prices, its governor Pan Gongsheng said on Tuesday.

QUOTES:

KHOON GOH, HEAD OF ASIA RESEARCH, ANZ, SINGAPORE

"The market reaction so far, I think is positive. While there was some anticipation that stimulus measures would be announced after they mentioned there was going to be a press briefing, the package of measures so far, I would say, is probably larger than what market was expecting. Now this slew of package - and particularly the one involving the new monetary policy tool to support equity, so that's interesting - I think we need to see what the details are.

"The chair of the CSRC is now also announcing some measures to support M&A activity, etc. So this looks like it is a comprehensive package, not only from the central bank, but also from the other financial regulators, I think in part designed to not only lower borrowing costs, but also to inject more liquidty into the economy and boost the equity market.

"Taken as a whole, this could help support the economy. Whether or not it is sufficient to address some of the underlying issues, particularly around the lack of confidence in the economy, I think still remains to be seen."

GARY NG, SENIOR ECONOMIST FOR NATIXIS, HONG KONG

“The move probably comes a bit too late, but it is better late than never. With an elevated real interest rate, poor sentiment and no rebound in the property market, China needs a lower-rate environment to boost confidence. With a more dovish Fed, China may be more willing to start a new round of laxer policy cycles. Higher disposable income and corporate income growth will be necessary for China to reboot its economy, meaning fine-tuning regulation may also be needed beyond fiscal and monetary policies.”

(Reporting by Xie Yu and Rae Wee)