China’s current economic growth is stable and expected to achieve its target of 6.5% or even slightly higher this year, said Yi Gang, governor of the People’s Bank of China, The Paper reported.
As the PBOC has cut the Reserve Requirement Ratio for four times this year, it has caused some worry in the market that the central bank is easing its monetary policy.
Yi responded that the monetary policy remains stable and neutral, neither being relaxed or tightened.
Citing the growth rate of M2, which is around 8%, Yi said this is basically equal to nominal GDP growth. Meanwhile, the growth rate of social financing is also at a reasonable level, at about 10%.
Facing the uncertainty mainly cause by the escalating trade spat with the US, Yi believes the central bank has considerable room for monetary policy tools, including interest rates, reserve ratios and monetary conditions. These tools are sufficient to deal with uncertainties, Yi insisted.