China’s central bank will keep its monetary policy flexible and appropriately adjust it according to changes in the country’s economic situation, bank governor Yi Gang said in a magazine article published late on Monday.
Yi said that tools he described as a “slow release of air” and “soft landing” must be used when the economy begins overheating or a bubble in asset prices starts developing, but that financial markets must be stabilized and public confidence enhanced if a recession or external shock occurred.
China’s central bank has recently eased monetary policy in the face of slowing economic and credit growth, with moves that included bringing down market interest rates and four cuts in bank reserve requirements so far this year.
Yi made his comments in an article in the China Finance magazine, which is published by the People’s Bank of China, to commemorate the 40th anniversary of its landmark economic reforms and opening up under former Chinese leader Deng Xiaoping.
He also said the central bank would continue to promote the opening up of China’s financial industry to technology, improve governance and develop a macro policy framework that will enhance international confidence in the renminbi.