Chinese central bank vows to keep interest rates stable during 2010

City A.M. Reporter
CHINA will stick to a relatively loose monetary stance in the second half of this year, with an emphasis on implementing policy flexibly, the People’s Bank of China (PBOC) said yesterday.

In a statement on its website, the central bank said it would combine its various policy tools, including open market operations and required reserves, in an appropriate way to further improve the management of banking liquidity.

The notice was in line with the bank’s previously stated stance. China’s economic leaders have ruled out major shifts in coming months by repeatedly pledging to maintain consistency and stability in fiscal and monetary policy.

“We will implement well our relatively loose monetary policy and strike a balance between economic growth, adjusting the structure of the economy and managing inflation expectations,” the central bank said.

The statement summarised a meeting of the PBOC’s leaders on how to implement the latest guidance on the economy given by the Communist Party’s Politburo and the State Council, China’s cabinet.

The Politburo has said it will maintain its control over China’s booming property market, while promoting stable export growth to strengthen the country’s recovery.

The PBOC, which met late last week, said it would do its bit to promote the healthy development of the real estate sector by continuing to stipulate different mortgage rates for different types of home buyer.