(Bloomberg) — China’s central bank vowed to take its share of responsibility to stabilize the macroeconomy and pro-actively introduce monetary policies that are conducive to economic stability.
The People’s Bank of China will step up its support for the real economy and continue to lower funding costs for companies, it said in a statement Monday evening after its 2022 work conference. The bank will use a variety of monetary policy tools to keep liquidity “reasonable and ample” and ensure credit growth is stable, it said.
In addition, the PBOC reiterated its promise to better satisfy the reasonable demands of home buyers and promote the healthy development of the property sector.
Read more: China’s Central Bank Vows Greater Support for Real Economy
The statement comes after the bank last week pledged greater support for the real economy in 2022 and said it would be more proactive in using its policy tools. The PBOC has so far taken a restrained approach to monetary stimulus but expectations are growing that it will do more in the new year, especially if property market problems and slowing private consumption continue.
Earlier this month the PBOC allowed banks to lower the benchmark lending rate by five basis points after unleashing 1.2 trillion yuan ($188 billion) of money by cutting the amount of funds banks are required to keep in reserve. It also reduced the interest rate for the re-lending program for small businesses. Credit growth picked up in November after slowing for almost a year.
Targeted support for key areas including small businesses, technology innovation, green transition and rural revitalization will be enhanced, according to Monday’s statement.
It said it will also strengthen supervision of capital and internet platform companies, and continue with the rectification work of leading online financial platforms. On the yuan, the bank maintained its stance that it will make the currency exchange rate more flexible, while keeping it basically stable at a reasonable and balanced level.
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