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The cabinet-level Financial Stability and Development Commission
(FSDC), convened by Vice Premier Liu He for its first meeting,
concluded on Monday that China's structural deleveraging was
progressing in an orderly way and financial irregularities had
been curbed.
"High-risk financial operations have shrunk and some
institutions have toned down their barbaric expansionary
behavior," the government said in a statement posted on its
official website on Tuesday.
The statement also confirmed an exclusive Reuters report that
Liu was going to be head of the FSDC, which is expected to help
improve supervision and coordination among regulators and the
central bank as the world's second-largest economy enters the
third year of an official crackdown on shadow banking and risky
lending.
The FSDC said overall financial operations were stable, and the
Chinese economy was resilient with many "favorable conditions"
to fend off major and external risks, without detailing the
conditions.
"The massive domestic market gives ample space as a cushion," it
said.
The Chinese currency CNY=CFXS and equity markets have been on
edge ahead of July 6, when U.S. tariffs on $34 billion worth of
Chinese goods kick in. Beijing has said it would retaliate with
tariffs on U.S. products.
China's central bank moved to calm jittery financial markets on
Tuesday after the yuan dropped through the psychologically
significant 6.7 to the dollar mark, hitting its lowest in almost
a year as anxieties over U.S. trade frictions deepened.
China's central bank governor Yi Gang is the vice head of the
FSDC, according to the statement.
(Reporting by Beijing Monitoring Desk; Writing by Yawen Chen;
Editing by Nick Macfie)
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