The
People's Bank of China (PBOC) will stick to normal monetary
policy, which will be flexible, targeted and appropriate, Sun
Guofeng, head of the central bank's monetary policy department,
told a briefing.
The PBOC will use various tools to keep liquidity reasonably
ample and enhance stability of total credit growth, he said.
"In the fourth quarter, supply and demand of liquidity in the
banking system will continue to be basically balanced and there
won't be any big fluctuations," Sun said.
The PBOC is likely to keep banks' reserve requirement ratio (RRR)
unchanged in the fourth quarter, before delivering another
50-basis points cut in the first quarter of 2022, the latest
Reuters poll of economists showed.
In July, the PBOC cut the RRR for banks, releasing about 1
trillion yuan ($155 billion) in long-term liquidity. Until
recently, most analysts had expected another RRR cut this year,
though some still hold out that possibility.
The PBOC will keep the yuan basically stable, Sun said, adding
China's inflation was under control.
The central bank will provide low-cost funds to financial
institutions to support carbon emission reductions and help
achieve the country's carbon neutrality goals, he said.
($1 = 6.4318 Chinese yuan renminbi)
(Reporting by Kevin Yao and Beijing newsroom; Editing by John
Stonestreet and Mark Potter)
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