China’s central bank to step up efforts to support economic recovery

BEIJING (Reuters) -China’s central bank said on Thursday it will step up efforts to consolidate an economic recovery, citing a slew of risks to the global economy while pledging to implement prudent monetary policy and keep liquidity reasonably ample.

The People’s Bank of China also said it will focus on stabilising employment and prices, and will seek ways to help reduce corporate financing and consumer credit costs.

“Global economic growth is slowing down, inflation is running at a high level, geopolitical conflicts continue, the external environment is becoming more complex and severe,” it said in a statement after a quarterly meeting of its monetary policy committee.

It added that while the domestic economy was continuing to recover, “it still faces the triple pressures of shrinking demand, supply shocks and weakening expectations.”

The government has in recent months rolled out a raft of measures to support the economy, which narrowly escaped a contraction in the June quarter, but the recovery remains shallow due to strict COVID curbs and a property slump.

Other measures cited by the central bank on Thursday included speeding up the use of special loans to ensure housing sales are completed, and its plans to guide commercial banks to provide financing support for the scheme.

The central bank also pledged to keep yuan exchange rate basically stable, enhance currency flexibility, strengthen expectation management and guide firms and financial institutions to adhere to the concept of “risk neutrality”.

On Thursday, the yuan bounced from a 14-year low against the dollar hit in the previous session, snapping eight straight days of losses, after the central bank warned against speculative trading and heavy one-way bets on the currency.

Premier Li Keqiang was quoted by state media as saying on Wednesday that China’s economy was in general recovering and has stabilised in the third quarter, and that the country will push ahead with its economic programme in the fourth quarter.

(Reporting by Kevin Yao and Beijing newsroomEditing by Edwina Gibbs)