China’s central bank vows stronger monetary policy implementation to expand demand, restore confidence
China's central bank said that it would step up policy adjustments and implement monetary policy to expand domestic demand and restore confidence at a quarterly meeting, according to a statement on its official website on Wednesday.
During the meeting, the bank emphasized the need to intensify the implementation of existing monetary policies, enhance counter-cyclical and cross-cyclical adjustments, and focus on boosting domestic demand and restoring confidence.
Regarding exchange rates, it stressed the importance of correcting deviations, stabilizing expectations, and firmly addressing unilateral and pro-cyclical behaviors to guard against the risk of exchange rate over-adjustment.
In light of the current domestic and international economic situation, the meeting noted that "the current external environment has become more complex and challenging," with inflation remaining high and developed countries expected to maintain elevated interest rates. Additionally, it acknowledged that "the domestic economy continues to recover and improve with strengthened momentum, but still faces challenges such as insufficient demand."
This statement also highlights the central bank's commitment to proactively managing monetary policy to support economic stability and address external and internal economic challenges.
The central bank also pledged to promote the healthy and stable development of the property market.
A number of support measures have already kicked in to stabilize the economic recovery of the world's second-largest economy. Profits across China's industrial enterprises above designated size in August increased by 17.2 percent year-on-year, data from the National Bureau of Statistics (NBS) showed on Wednesday. Overall, profits were down 6.7 percent in July.
The rebound was in line with the momentum of China's industrial output data in August, grew 4.5 percent from a year earlier, accelerating from the 3.7 percent pace seen in July. Retail sales, a gauge of consumption, also grew at a faster 4.6 percent pace in August aided by the summer travel season, and was the quickest growth since May.
Analysts expected the recovery will further accelerated with the upcoming eight-day Golden Week holidays.