China to maintain stable liquidity as reform moves forward

[BEIJING] China will maintain a monetary policy that is "neither too tight or too loose", ensuring basically stable liquidity, a senior central banker told a financial conference in Beijing on Saturday.

Chen Yulu, deputy governor at the People's Bank of China (PBOC), also said that economic structural reform would play an increasingly important role in the government's policy toolkit, according to domestic media reports of his comments.

Mr Chen's remarks echo statements made by the central bank and its advisers in recent months. In its first-quarter monetary policy implementation report released in May, the PBOC said it would maintain a prudent and neutral monetary policy and keep liquidity basically stable.

PBOC adviser Sheng Songcheng was also quoted by a local financial magazine last month saying the central bank would not excessively adjust monetary policy.

Mr Chen said the central bank would continue to manage aggregate demand as part of the country's ongoing supply-side reform.

He also warned companies about stepping blindly into financial activities and sticking to their core businesses.

REUTERS