BEIJING, Dec.27 (Reuters) – The People’s Bank of China (BPC) on Monday announced plans to maintain flexible monetary policy in 2022 to stabilize growth and lower the costs of financing businesses amid mounting economic difficulties .
In a statement summarizing its meeting for the coming year, the central bank added that it would strengthen the supervision of financial companies and gradually put in place a system to manage the financing of the real estate sector.
The indebtedness of the largest Chinese real estate developers has shaken a sector essential to the country’s economic growth.
“Prudent monetary policy is flexible, reasonable and appropriate,” she said.
It clarified that it plans to use multiple policy tools to maintain adequate liquidity and ensure that the growth of its money supply and social finance is in line with the growth of nominal gross domestic product.
“The BPC will effectively assume responsibility for stabilizing the macroeconomy and proactively deploy monetary and financial policies conducive to economic stability,” she added.
The central bank stressed that it would seek to increase the yuan’s fluctuations while keeping it at a reasonable and balanced level, and to improve the interest rate peg in order to reduce the costs of financing companies.
The BPC said it will also implement prudent and regular management of the real estate sector financing policy, reaffirming a position taken at the Central Economic Labor Conference earlier this month. (Report Stella Qiu, Ella Cao and Ryan Woo, French version Laetitia Volga, edited by Marc Angrand)