How are the prices going in 2024? What are the factors underpinning the rmb exchange rate? How are interest rates adjusted? The central bank responded and answered at the new york office launch on january 24。
Downsizing of 0. 5 percentage points of deposit reserve
“there is still enough room for our monetary policy today.” at the launch, the president of the people's bank of china, ban kung-sung, stated that the central bank would balance short- and long-term, stable growth and risk prevention, internal and external balance, strengthen counter-cyclical and cross-cyclical regulation, and create a sound monetary and financial environment for economic performance。
On 5 february, the people's bank of china reduced the deposit reserve rate by 0. 5 percentage points to provide long-term liquidity of rmb 1 trillion. Pan kung-hoon points out that the current average of 7. 4 per cent of the statutory deposit reserve rate in our country is still relatively large compared to the central banks of the major international economies, an effective tool to complement long-term liquidity in the banking system。
Better use of deposit interest rate market adjustment mechanisms
“in terms of interest rates, monetary policy operations insist on me being the main one.” the success of pan xin mentioned that the current price levels are still far from the price expectations. In november and december of last year, the country's major banks reduced their deposit rates。
As of january 25, the central bank will reduce the interest rate for re-financing and rediscounting from 2 per cent to 1. 75 per cent for small-scale re-lending to financial institutions. These measures will contribute to the downward trend in the lending price-fixing benchmark, the lpr。
In response to the shrinking spreads on domestic bank loans, the vice-president of the people’s bank of china, mr. Chen chang, mentioned that the central bank would take into account the value-for-money relationship between the rate of deposit and the rate of return on management, the rate of dividends, etc., so as to make better use of the mechanism of market adjustment of deposit rates, and support banks in reducing the cost of indebtedness while maintaining a reasonably orderly market environment and creating conditions for lower loan rates。
Refinement of the policy on entrepreneurship loans
Since last year, financial institutions, under the guidance of the financial authorities, have been working to support stable access to finance for real estate enterprises, especially for head-office enterprises。
On the evening of 24 december, the general office of the people's bank of china and the general office of the state financial supervision authority issued a circular on the proper management of loans for business property. Pan kung-sung noted that the policy supported high-quality housing stock assets, expanded the use of funds and improved liquidity。
In 2022, the province of shanxi invested $12. 2 billion in secure tenure. Gore
China's price will rise mildly in 2024
In 2023, the chinese economy maintained low inflation. How are prices this year
Ban kung-sung noted that international financial organizations such as the imf and financial institutions in multiple markets predicted that china's price levels would rise mildly in 2024 as domestic demand continued to improve and the external price situation changed。
In the use of monetary policy instruments, the central bank will strengthen cross-cyclical and counter-cyclical regulation to create a sound monetary and financial environment for economic growth and price stability. In particular, it includes the maintenance of price stability and the promotion of a moderate recovery in prices as an important consideration in managing monetary policy. Economic growth should be promoted by adhering to monetary policy objectives and maintaining stability in the currency. Optimizing financial resource investment. Inducing financial institutions to assess risks in a scientific manner and to limit the availability of financing to overcapacity-producing industries, while meeting reasonable consumer financing needs more specifically. Strengthen coordination of financial and other policies。
The rmb exchange rate will remain essentially stable at a reasonable level of equilibrium
“china's monetary policy has always been focused on me, taking into account both internal and external balance.” in 2023, in the face of the spillover effects of monetary policy in developed economies, the people's bank built on domestic economic development, lowered policy interest rates twice, lowered deposit reserve rates twice, maintained a reasonable level of market liquidity, optimized credit structures and strongly supported the real economy. Overall, the rmb exchange rate has remained largely stable in complex situations。
He concluded that the exchange rate of the renminbi in 2024 would continue to be generally stable at a reasonable level of equilibrium. A sound domestic economy, a shift in the federal reserve’s monetary policy and a weakening of the dynamism of the dollar, better investment and risk avoidance in the renminbi’s assets, and a stronger micro-base of stable exchange rates will support the renminbi’s exchange rate。
