China’s central bank to use ‘precise, forceful’ policy to bolster recovery

BEIJING (Reuters) -China’s central bank said on Wednesday it would step up policy adjustments and implement monetary policy in a “precise and forceful” manner to support the economic recovery.

The People’s Bank of China (PBOC) will keep liquidity reasonably ample and maintain stable credit expansion, the bank said in a statement after a quarterly meeting of its monetary policy committee.

“The current external environment is becoming more complex and severe, international economic trade and investment are slowing down, inflation is still high, and interest rates in developed countries remain high,” the central bank said.

“The domestic economy continues to recover and improve, within increasing momentum, but it still faces challenges such as insufficient demand.”

“We need to continue to work hard and take advantage of the improving momentum, step up macro policy adjustments, implement the prudent monetary policy in a precise and forceful manner,” the PBOC said.

The world’s second-largest economy is showing some signs of stabilising after a flurry of modest policy measures, but the outlook is clouded by a property downturn, aging demographics, high debt and geopolitical tensions.

China will step up government investment and policy incentives to spur private investment and promote a recovery in prices from a low level, the central bank said.

The PBOC reaffirmed its stance of keeping the yuan stable and preventing the risk of currency overshooting.

The central bank also pledged to promote the healthy and stable development of the property market.

(Reporting by Beijing newsroom and Kevin Yao; Editing by Himani Sarkar and Christian Schmollinger)