Stabilizing prices remains top priority for China: central bank

(Xinhua)

11:48, August 13, 2011

BEIJING, Aug. 12 (Xinhua) -- The People's Bank of China (PBOC), or the central bank, said Friday that it will continue to make stabilizing prices a top priority of its macro controls in the remaining months of the year.

It will stick to its regulation stance and continue a prudent monetary policy, while focusing on supporting the transformation of the country's economic growth pattern, the PBOC said in a report summarizing the implementation of its monetary policy in the second quarter.

It will closely monitor and study domestic and international economic situations and work to make the monetary policy more targeted, flexible and foresighted, said the report posted on the PBOC's website.

Efforts will also be made to cement regulation results that has been achieved and evaluate the policies' current and desired effects through scientific manners, while properly handling relations among maintaining relatively fast economic growth, restructuring the economy and managing inflationary expectations, said the report.

The PBOC will also employ multiple monetary tools, including the interest rate, exchange rate, and open market operation, to check liquidity and keep the social financing at a reasonable level, it noted.

To manage inflationary expectations, the PBOC will properly use the monetary policies such as the interest rate to control the capital demand and investment savings, the report said.

It will continue to use dynamic regulation measures such as the reserve requirement ratio (RRR) to guide and encourage financial institutions to stay prudent and adjust their credit supplies.

Meanwhile, it will increase efforts to promote the country's credit structure, including strengthening supports to the agricultural sector and middle and small-sized enterprises and the implementation of the differentiated housing credit policy, it added.

Further, the PBOC will steadily promote the market-oriented reform of its exchange rate and improve the formation mechanism of the yuan's exchange rate to add flexibility while keeping it basically stable at a proper and balanced level, it added.

The country's consumer price index, a main gauge of inflation, accelerated to a 37-month high of 6.5 percent in July, well above the government's target ceiling of 4 percent.

This year, China has made curbing inflation a top priority and implemented a prudent monetary policy.

The PBOC has hiked benchmark interest rates three times and the RRR six times this year.

Increases the bookmark

• twitter
• facebook
• Sina Microblog
• digg
• Google
• Delicious
• buzz
• friendfeed
• Linkedin
• diigo
• reddit
• stumbleupon
• Qzone
• QQ Microblog

Related Reading

Leave your comment0 comments

Weekly review

1. The week in pictures(July 31-Aug.6,2011)
2. Chinese-American ambassador to China key to boosting ties
3. Why is Japan sounding 'China threat' alarm again?
4. Political negotiations needed to end Libya deadlock
5. China should adhere to scientific outlook on development
6. Chinese-American ambassador to China key to boosting ties
7. People's Daily website revamps English version
8. Report: China's urban middle-income class growing