Chinese central bank stresses flexibility in monetary policy

GMT 22:42 2016 Friday ,01 April

Arab Today, arab today Chinese central bank stresses flexibility in monetary policy

China's central bank
Beijing - XINHUA

China's central bank on Friday pledged to maintain its prudent monetary policy, but with added flexibility to cope with increasing complexity in the financial market.

The policy will be kept "neither too tight nor too loose," and China will use multiple policy tools to maintain liquidity in the market and realize reasonable credit growth, the People's Bank of China (PBOC) said in a statement issued after a meeting chaired by its governor, Zhou Xiaochuan.

The statement noted mounting risks in the global financial market, concluding that the complexities "should not be underestimated."

More efforts will be made to increase the share of direct financing, reduce social financing costs, deepen financial reforms and strengthen risk management, the PBOC pledged.

The central bank also vowed to carry out further reforms in interest rate liberalization and the yuan's exchange rate formation mechanism and ensure the currency's stability.

To arrest the cooling of the economy, which logged its lowest annual expansion in a quarter of a century at 6.9 percent in 2015, China has cut benchmark interest rates and the reserve requirement ratio of banks several times since 2014.

At a press briefing last month, a PBOC spokesperson described its monetary policies as "prudent with a slight easing bias.

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