Monetary
Policy Committee Held Its Second Quarterly Meeting in 2008
The Monetary Policy Committee of the People´s Bank of China (PBC)
held its second quarterly meeting of 2008 in Beijing days ago.
After analyzing the economic and financial situation, the Committee
held that the Chinese economy maintained a sound and rapid development
momentum, but the inflationary pressure was noticeable and the BOP imbalances
still remained despite the generally upbeat situation. Global inflationary
pressure continued to mount, the world economy slowed down, and more uncertain
and disabling factors emerged. In accordance with the overall arrangement of
the State Council, the PBC properly managed the priorities, pace and intensity
of financial macro control. In general, the Chinese economy and financial
sector performed well.
It was noted that adverse factors in the global economy and severe
natural disasters in China added new uncertainties to China´s economic performance, but the
fundamentals remained unchanged. Efforts should be made to fully implement the
scientific approach to development, to take maintaining relatively rapid
economic growth and curbing excessive price increase as top priority, and to
attach great importance to containing inflation. At the same time, the urgency
of economic restructuring should be fully recognized, and coordination of the
monetary policy with fiscal policy, industrial policy, trade policy and
financial regulatory policy should be enhanced, to accelerate economic
restructuring and promote a basic equilibrium of the balance of payments.
Weighing the monetary policy stance and measures for the coming
periods, the Committee held the view that efforts should be made to keep the
continuity and stability of the monetary policy, take more preemptive, targeted
and flexible financial macro control measures, properly manage the focus, pace
and intensity of these measures and various monetary policy instruments in line
with the macroeconomic adjustment policies of the State Council, so as to
create a benign monetary environment for sound and rapid economic development.
It is necessary to improve the credit structure in the principle of encouraging
growth in some sectors while discouraging it in others, to increase financial
support for agriculture, rural areas and farmers, post-quake reconstruction,
students, consumption, those industries that have created lots of jobs but are
in difficulties, to support balanced economic development across regions, to guide
financial institutions to provide proper financial products and services and render more lending support to small- and medium-sized
enterprises. The market-based interest rate reform should be pursued, and the
leverage role of interest rate should be played out. The principle of making
the RMB exchange rate reform a self-initiated, controllable and gradual process
should be followed to keep the RMB exchange rate basically stable at an
adaptive and equilibrium level. Improvement of the foreign exchange management
regime reform should be effected by strengthening the oversight over
cross-border capital flow. Vigorous actions should be taken to push ahead
financial reform and innovations to improve the competitiveness of financial
institutions and efficiency of financial market in resources allocation.
Mr. Zhou Xiaochuan, Governor of the PBC and Chairman of the Monetary
Policy Committee chaired the meeting. Other Committee members present at the
meeting included Mr. Zhu Zhixin, Mr. Li Yong, Ms. Wu Xiaoling, Mr. Liu
Mingkang, Mr. Shang Fulin, Mr. Wu Dingfu, Mr. Jiang Chaoliang and Mr. Fan Gang.
Mr. Zhang Ping, Mr. Su Ning, Mr. Xie Fuzhan and Ms. Hu Xiaoliang were absent
from the meeting on business leaves. Presidents of the PBC Jinan Branch,
Guangzhou Branch and Xi´an Branch also joined the meeting.
