China’s central bank vows to step up policy support for economy

BEIJING: China’s central bank vowed to step up counter-cyclical adjustments, expand domestic demand and optimise supply to strive to achieve the annual economic development goals amid domestic and external headwinds, according to its third-quarter monetary policy implementation report released on Wednesday.

China’s economy faces challenges including a mismatch between strong supply and weak demand, structural imbalances and external shocks, and the external environment has become increasingly complex and volatile, the People’s Bank of China (PBOC) said in the report.

The PBOC said it would continue to implement appropriately loose monetary policy to create a favourable monetary and financial environment for stable economic growth.

The central bank reiterated its pledge to adjust monetary policy tools in a timely manner. The PBOC said it would maintain low overall borrowing costs and keep the yuan exchange rate basically stable at a reasonable and balanced level.

The central bank will strengthen financial support for key areas including domestic demand, scientific and technological innovation and infrastructure projects, according to the report.

The central bank also vowed to enrich its policy toolkit and safeguard the stable operations of the stock, bond and foreign exchange markets.

CHINA’S OCT NEW BANK LOANS SHRINK

China’s new bank lending fell in October for the third time this year, underscoring weak credit demand as households and businesses remain cautious despite Beijing’s efforts to spur borrowing and revive growth.

China’s new yuan loans shrank by 100 billion yuan (USD14.99 billion) in October, having also declined in April and July, according to Reuters calculations based on data from the People’s Bank of China on Friday. Analysts polled by Reuters had expected October new yuan loans to reach 20 billion yuan, compared with 220 billion yuan a year earlier.

The central bank does not provide monthly breakdowns. Reuters calculated the October figures based on the bank’s January-October data, compared with the January-September figure.

October is typically a weak month for new credit demand, following a quarter-end lending push with a week-long national holiday cutting working days.