October 18, 2024 06:40 GMT
MNI BRIEF: PBOC To Curb Challenges Of House And Equity Markets
MNI (BEIJING)
The monetary policy toolbox will continue to be added to, with structural facilities playing a crucial role, and the Bank will gradually increase the government bonds trading as a joint working group has been established between the PBOC and the Ministry of Finance, said Pan. He noted that the PBOC has strengthened communication with the market regarding long-term government bond yields, aiming to curb systemic risks that could arise from the herd effect leading to a one-sided decline in long-term government bond yields.
China is facing challenges from both real estate and capital markets, and the People's Bank of China could cut reserve requirement ratio by a further 25 to 50bps before the year-end depending on market liquidity conditions, Governor Pan Gongsheng told a forum on Friday.
Strong measures are needed to address issues including insufficient demand, weak expectations, and low price levels, he said, noting the macroeconomic policy should balance consumption and investment, although with a greater emphasis on consumption, he said. Efforts are being made to cultivate new drivers of growth as the economic transformation may have short-term impacts on economic performance, the Governor added. (See: MNI EM: PBOC Eyes Lower Rate For GDP Target, RRR Cut Optional )
The monetary policy toolbox will continue to be added to, with structural facilities playing a crucial role, and the Bank will gradually increase the government bonds trading as a joint working group has been established between the PBOC and the Ministry of Finance, said Pan. He noted that the PBOC has strengthened communication with the market regarding long-term government bond yields, aiming to curb systemic risks that could arise from the herd effect leading to a one-sided decline in long-term government bond yields.
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