2024-10-02 19:29:34
SHANGHAIChina will continue to maintain its accommodative monetary policy, as well as strengthening countercyclical and intertemporal adjustments, the central bank governor said this Wednesday, June 19.
The measure will help facilitate the recovery of the economy and create a favorable monetary and financial environment for economic and social development, said Pan Gongsheng, governor of the People’s Bank of China (PBOC), at the 15th Lujiazui Forum held in Shanghai.
Likewise, he commented that looking to the future, the country’s economy, although experiencing continued recovery, still faces some challenges, since effective demand remains insufficient, there are blockages to internal economic circulation, and the complexity, severity and uncertainty of the external environment have increased significantly.
Since the beginning of this year, global inflation has begun to ease, but remains strongly adhesive, Pan said, adding that some central banks, such as the European Central Bank, have begun rate reductions, while others continue to monitor developments. and they could reduce them by the end of this year.
In general, central banks maintain their high interest rates and tight monetary policy, while China differs somewhat from them, Pan said. “Our monetary policy stance is accommodative and provides financial support for the continued economic recovery.”
According to the PBOC governor, the bank has adopted various monetary policy instruments, such as reducing the reserve requirement ratio and official interest rates, as well as lowering market rates, such as preferential interest rates. loans, which has created a favorable monetary and financial environment for the high-quality development of the economy.
At the end of May, the annual growth rate of aggregate financing to the real economy and M2 reached 8.4 and 7 percent, respectively, both higher than the growth rate of nominal GDP in the first quarter of this year. anus. The interest rate on new loans issued in May stood at a relatively low level of 3.67 percent.
Regarding the structure of money and credit, the PBOC gave full prominence to the role of macroprudential policies and structural monetary policy instruments, Pan highlighted.
“We have initiated central bank loans for science and technology innovation and technological transformation, which aim to increase financial support for scientific and technological innovation and equipment improvement and renewal. “We have implemented a package of policies to support the real estate sector, which includes the reduction of minimum down payment percentages for mortgages on commercial homes for individuals,” he declared.
Currently, the outstanding balance of China’s structural monetary policy instruments is valued at about 7 trillion yuan ($983.7 billion), accounting for about 15 percent of the PBOC’s balance sheet, Pan said, adding that Instruments were established to support key areas and weak links of the national economy, such as micro and small business development and ecological transformation.
The PBOC also aims to regulate market behavior, make better use of existing inefficient financial resources, and optimize the efficiency of the use of funds.