China Strengthens Monetary Policy to Boost Economic Stability and Growth

The Chinese mainland is set to intensify its counter-cyclical monetary policy to ensure stable economic growth and high-quality development, announced Pan Gongsheng, governor of the People’s Bank of China.

In a recent report presented to the 12th session of the Standing Committee of the 14th National People's Congress, Pan emphasized the commitment to a supportive monetary policy. \"We will adhere to a supportive monetary policy, intensify and improve the precision of monetary policy regulation, effectively implement existing policies, and make greater efforts to materialize incremental policies,\" he stated.

Pan highlighted the importance of maintaining adequate liquidity and lowering financing costs for both enterprises and households. The central bank aims to utilize structural monetary policy tools to support major strategies and address key areas and weaknesses within the economy.

Ensuring synergy between monetary and financial policies with fiscal, industrial, and employment policies is a key focus. Pan also assured measures to prevent exchange rate overshooting, maintaining the RMB exchange rate at a stable and balanced level.

Financial supervision and regulation will be strengthened through strict market access and off-site supervision for financial institutions. Coordination between central and local financial supervision bodies will be enhanced to protect the rights and interests of financial consumers and investors.

The People’s Bank of China plans to improve the quality and efficiency of financial services by optimizing credit structures and supporting new quality productive forces. Initiatives to nurture patient capital and promote the development of science and technology innovation bonds and green bonds are also on the agenda.

Further financial reforms and opening up will include supporting large commercial banks in capital replenishment, expanding foreign investment channels in China’s capital market, prudently advancing the RMB’s internationalization, and promoting the growth of Hong Kong and Shanghai as international financial centers.

Pan concluded by assuring proactive and prudent measures to prevent and mitigate financial risks, maintaining the overall stability of the financial system.

Reference(s):

China to intensify counter-cyclical adjustment of monetary policy

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