MNI BRIEF: PBOC Policy Supports Economic Stability - Yi Gang

China’s monetary policy has provided strong support for the economy and the People's Bank of China's balance sheet has remained relatively stable in recent years as support has increased, said PBOC Governor Yi Gang at the Financial Street Forum 2022.

Yi said the intensity of policy is appropriate, which not only supports the stability of the economy but also maintains stable prices in the context of global high inflation. He said the average annual increase in China’s CPI had been around 2% over the past five years and the yuan has maintained its value and purchasing power as it had depreciated less than other currencies against the U.S. dollar this year.

The PBOC has created special refinancing tools for scientific and technological innovation, transportation and logistics, and equipment renewal, totaling CNY3 trillion. These are phased tools that can be exited in an orderly manner when policy goals are met, according to Yi.

As of end-September, the total size of the PBOC's balance sheet was about CNY40 trillion, and the average growth rate over the past five years was 2.6%, which remained relatively stable.