MNI China Press Digest July 18: PBOC, Monetary Policy, Housing

The following lists highlights from Chinese press reports on Monday:

• The People's Bank of China will step up the implementation of its prudent monetary policy to provide stronger support for the real economy, Governor Yi Gang said in a meeting of G20 central bank governors and finance ministers, according to a statement on the PBOC website late Saturday. The economy faces certain downward pressures due to the pandemic and external factors, though inflation is relatively low and expectations remain stable, said Yi.
• China’s monetary policy has sufficient space and tools to cope with any new challenges in the second half of the year, the Economic Daily said in a commentary. There is still room for lowering the reserve requirement ratio, as the weighted average deposit reserve ratio of financial institutions is currently 8.1%, the newspaper said. Meanwhile, the foreign exchange market is more resilient with more stable cross-border capital flows, as market players are more adaptable and tolerant to the ups and downs of the yuan, providing a better foundation to resist external shocks, the daily said.
• China’s top banking watchdog will support local governments to promote the delivery of property projects, an unnamed official from the China Banking and Insurance Regulatory Commission said in an interview with the China Banking and Insurance News. More homebuyers across the country are refusing to pay mortgages for unfinished or stalled housing projects recently, raising concerns about systemic risks. Banks should actively participate in the study of plans to reasonably solve the funding gap, and offer credit, the official was cited as saying. The regulator also said last week it would guide financial institutions to participate in risk disposal in a market-oriented manner.