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China says monetary policy to be prudent and neutral in 2017

Friday, December 16, 2016 - 18:32

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China's monetary policy will be prudent and neutral next year while fiscal policy will be proactive, according to a statement from the official Xinhua News Agency released after a key planning meeting of top officials.

[BEIJING] China's monetary policy will be prudent and neutral next year while fiscal policy will be proactive, according to a statement from the official Xinhua News Agency released after a key planning meeting of top officials.

Preventing and controlling financial risk to avoid asset bubbles will be a priority, along with deepening supply-side structural reform, the state-run news service reported Friday. Policy makers aim to ensure currency and liquidity levels are both kept basically stable.

President Xi Jinping reviewed economic progress this year and mapped out the plan for 2017 at the annual Central Economic Work Conference in Beijing, according to another report Friday from the official China News Service. Mr Xi discussed the domestic and international economic situations at the meeting.

Mr Xi and his top policy lieutenants gathered for the three-day meeting having steadied the economy, with full-year growth on pace to sail right between the goalposts of their 6.5 per cent to seven per cent objective. Forecasters are raising 2017 estimates too.

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Top cadres use the event to reach consensus on the most important issues in the next year. It includes members of the Communist Party's Politburo, ministers, provincial governors, top officials from the nation's judicial system, and heads of state-owned enterprises.

Economic indicators suggest a fourth-straight quarter of stable growth this year will give policy makers breathing room to rein in excessive borrowing leverage and contain risks.

Economists have raised first-quarter growth estimates to 6.6 per cent, from 6.5 per cent a month earlier, according to a Bloomberg survey. Forecasts for 2016 full-year expansion inched up to 6.7 per cent from 6.6 per cent in September, while 2017 projections climbed to 6.4 per cent from 6.3 per cent over the period.

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