MNI BRIEF: PBOC Aides Outline Policy Steps To Boost Economy

The People’s Bank of China pledged to enhance the transmission of monetary policy and increase credit to shore up an economy that faces headwinds from lockdown measures to deal with a pandemic surge, central bank officials briefed reporters on Thursday.

Sun Guofeng, head of the PBOC monetary policy department, said policy will remain “flexible, appropriate and front-loaned at a reasonable pace” as China faces economic headwinds. The PBOC will use tools including cutting the reserve requirement ratio further to help sectors hit badly by Covid-19 curbs, by both lowering borrowing costs and stabilising credit expansion, including the relending program targeting small businesses, Sun added By the end of March, outstanding bank loans to small businesses reached CNY1.85 trillion, he said.

Ruan jianhong, head of the PBOC’s statistics department said the new corporate loan rate fell to 4.37% in March, 8bps lower than in December through optimizing regulation on deposit interest rate and lowering loan prime rate in Q1. By the end of March, outstanding bank loans to small businesses reached CNY20.8 trillion, increasing 24.6% year on year, Sun said, adding the outstanding relending to small business and agriculture totalled CNY 1.850trillion as of the end of march