Targeted Monetary Policy Needed - Expert

The People’s Bank of China (PBOC) should use more targeted policies to support the private sector, according to Liu Yuanchun, president at Shanghai University of Finance and Economics. At a recent forum, Liu noted current monetary policy was heavily distorted in favour of state owned and large companies in Q1, with policy interest rates at about 3%, state owned company rates near 1.8% and private firms charged 6-10%. Liu said the PBOC needs to address the imbalance with more targeted measures to help SME firms recover and restore confidence. The government should address weak CPI growth, which will hurt company profits by speeding up urbanisation and increasing affordable housing. (Source: Yicai)