China has room for monetary policy adjustments: central bank

CHINA has room to adjust monetary policy as stimulus measures to support the pandemic-hit economy have been restrained and consumer inflation remains under control, a spokesperson for the central bank said on Friday (Sep 2).

China will continue to improve on and deploy its various monetary policy tools to support the economy, and keep liquidity reasonably ample, Ruan Jianhong, spokesperson of the People's Bank of China (PBOC), said at a finance forum in Beijing.

"Since the pandemic, China adopted normal monetary policy instead of excessive stimulus, leaving room for subsequent monetary policy adjustments," Ruan said.

China's relatively stable consumer inflation will help create sound conditions for monetary policy changes, she said.

She added that China will pay close attention to inflation at home and abroad, avoid flood-like stimulus and keep consumer prices basically stable.

The recovery in the world's second-biggest economy is in danger of fizzling out amid fresh coronavirus flare-ups and a distressed property sector.

Signs of consumer price pressures - long benign in China - are beginning to emerge. The consumer price index in July rose 2.7 per cent from a year earlier, the fastest pace since July 2020, even as activity cooled.

The government said it will publish detailed steps for newly announced economic policy measures in early September, suggesting an urgency for policymakers to revive the sluggish economy, as recent factory activity surveys pointed to a further loss in momentum in the economy in August.

China cut its benchmark lending rate and lowered the mortgage reference by a bigger margin last week, as Beijing stepped up efforts to revive the Covid-ravaged economy. REUTERS


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