China’s central bank to step up policy implementation to spur growth

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FILE PHOTO: The headquarters of the People's Bank of China, the central bank, is pictured in Beijing

BEIJING – China’s central bank said on Wednesday it will step up the implementation of prudent monetary policy and keep liquidity reasonably ample, in a bid to support the slowing economy.

The People’s Bank of China (PBOC), in a statement after the conclusion of a quarterly meeting of its monetary policy committee, promised to use aggregate and structural policy tools to boost confidence in the economy.

“At present, global economic growth is slowing, inflation is running at a high level, geopolitical conflicts continue, and the external environment is becoming more complex and severe,” the PBOC said.

“Economic development is facing triple pressures of shrinking demand, supply shock and weakening expectations.”

China’s favourable conditions of stable and increased grain output and a stable energy market will help keep domestic inflation basically stable, the central bank said.

China’s economy has recovered to some extent, but its foundation is not solid, state media on Tuesday quoted Premier Li Keqiang as saying.

Central bank governor Yi Gang said earlier this week that China’s monetary policy would continue to be accommodative to support the recovery.

The PBOC will improve the market-oriented interest rate regime, promote the reduction of comprehensive financing costs for enterprises, and support banks to replenish capital, it said in the statement.

The central bank also reaffirmed its stance of making the yuan exchange rate more flexible and keep the yuan basically stable.

(Reporting by Kevin Yao and Beijing Newsroom; Editing by Andrew Heavens and Alison Williams)

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