ECONOMY

Bank Reform

In the latest effort to boost growth, China’s central bank has pledged to push market-based reforms, aiming to significantly bring down real interest rate levels and cut social financing costs.

Prudent monetary policy should be pursued with moderate flexibility to maintain market liquidity at a reasonably ample level, according to a statement published on January 1 after a regular meeting of the Monetary Policy Committee of the People’s Bank of China.

China will ensure that the increases in M2 money supply (cash in circulation and all deposits) and aggregate financing will be in keeping with nominal GDP growth, the statement said, ruling out the possibility of “flood-like” stimulus.

Financial supply-side structural reform will be advanced