MNI: China 2018 MonPol Remains Prudent and Neutral: PBOC

     BEIJING (MNI) - The People's Bank of China will maintain a prudent and

neutral monetary policy stance and further push forward the opening up of the

financial sector, a statement posted on the central bank's official website

Tuesday said.

     Following a meeting chaired by Yi Gang, the vice-governor of the central

bank, the PBOC also said it will keep the liquidity condition at a reasonable

and stable level, by using multiple instruments of monetary policy, adding that

credit and total social financing will grow at a proper pace.

     Macro-prudential policy will enhance regulation across areas including

shadow banking and property sector in a bid to prevent financial risks, the

statement said.

     The post-meeting statement also said the PBOC will allow markets to

determine the yuan exchange rate to a greater extent, and to keep the yuan

generally stable at a reasonable and balanced level. The PBOC will continue to

push forward the internationalization of the yuan, and to advance the reform of

foreign exchange management regime.

     The PBOC will improve the settlement mechanism for bond defaults and keep

financial markets developing steadily and healthily. The central bank also

stressed it will build and improve the financial support system of apartment

leasing, preventing risks from internet finance.

     The PBOC's statement will also deepen its reform of interest rate

liberalization, continuing to investigate the mechanism of "interest rate

corridor" and enhance the capabilities to adjust and control interest rates.

--MNI Beijing Bureau; +86 (10) 8532 5998; email: marissa.wang@marketnews.com

--MNI Beijing Bureau; +86 10 85325998; email: he.wei@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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