PBOC: China to continue implementing prudent monetary policy
CGTN

China's central bank said Saturday that the country will continue to implement its prudent monetary policy and adopt counter-cyclical adjustments to ensure liquidity and reasonable social financing growth.

The bank will continue to apply various monetary instruments, including relending, rediscounting and targeted reserve requirement ratio (RRR) cut to better serve the real economy, said the People's Bank of China (PBOC) in its third quarter monetary policy report.

It will continue to promote interest rate liberalization and the reform of the renminbi exchange rate. It will improve the floating exchange rate system based on the market supply and demand and with reference to a basket of currencies and work to keep the renminbi exchange rate basically stable, reasonable and balanced.

The bank said it will continue to reform the country's loan prime rate (LPR) mechanism and encourage financial institutions to issue new loans under the mechanism to reduce financing costs for enterprises.

The LPR serves as a market-based reference for lenders to set their loan interest rates. Banks are expected to take the LPR as the major lending rate reference when issuing loans.

The PBOC said it will continue to improve the financial market system to make it an important player in restructuring, stabilizing growth and guarding against risks. The bank will further enhance the infrastructure building in the financial market and optimize transaction, clearing and settlement regulations.

Meanwhile, it will deepen the supply-side structural reform in the financial sector and further expand the opening up of the sector and relax market access for banks, securities and insurance companies.