MNI BRIEF: PBOC To Maintain Moderately Loose Monetary Policy

The People’s Bank of China will implement a moderately loose monetary policy, utilise various tools to maintain relatively loose social financing conditions, while continuing to improve its policy framework and strengthen its implementation and transmission, according to the Q3 monetary report released Tuesday.

The PBOC will maintain ample liquidity, ensuring that the growth of social financing and money supply matches the expected targets for economic growth and the general price level, the report said, noting that promoting a reasonable recovery in prices will be a key policy consideration. (See MNI INTERVIEW: PBOC To Boost Tech Loans Via Structural Tools)

The central bank will maintain exchange rate flexibility, strengthen expectation guidance, prevent the risk of overshooting, and keep the yuan basically stable at a reasonable and balanced level, the report said.