Monetary Policy Committee of the PBC Held the 3rd Quarterly Meeting of 2006

The Monetary Policy Committee of the PBC held the 3rd Quarterly Meeting of 2006 in Beijing days ago.

It was agreed at the meeting that the economy maintained a steady and relatively fast growth with generally good performance, indicating that macroeconomic management achieved initial effects. In line with the arrangement of the State Council, the PBC has closely monitored the economic and financial performance, and curbed the overly rapid growth of money and credit with a mix of various monetary policy tools. The overall performance of the financial sector has remained sound. 

The Committee conducted an in-depth analysis of current economic and financial situation both at home and abroad. It was concurred that the economic situation continued to be broadly favorable. However, certain problems remained, such as the structural imbalances, increasing pressures on environment and energy, and international payment imbalances. In the coming period, continued efforts should be made to maintain the continuity and stability of macroeconomic policies, consolidate the macro management effects, strengthen policy coordination, actively boost domestic consumer demand, optimize investment structure, and promote the appropriate growth of investment. Comprehensive measures should be taken to accelerate economic restructuring and transformation of growth pattern, intensify the system reform and promote equilibrium of international payments so as to achieve a balanced and sustainable development of the national economy.

In discussing monetary policy stance and policy measures to be adopted in the coming period, the Committee consented that the sound monetary policy should be continued, and steps should be taken to promote coordination between domestic and foreign currency policies and strengthen the liquidity management of banking system. With regard to properly controlling the money and credit growth, commercial banks will be guided to expand the fee-based business and improve profit structure. Meanwhile, efforts should be made to quicken the steps in the development of direct financing and promote a coordinated development of financial market. Measures should also be taken to improve the managed floating exchange rate regime in a self-initiated, controllable, and gradual way and enable the market supply and demand to play a fundamental role in the formation of the RMB exchange rate so as to keep the RMB exchange rate basically stable at an adaptive and equilibrium level.

The meeting was chaired by Mr. Zhou Xiaochuan, Governor of the PBC and Chairman of the Monetary Policy Committee, and attended by other Committee members including Mr. Li Yong, Ms. Wu Xiaoling Mr. Su Ning, Mr. Qiu Xiaohua, Ms. Hu Xiaolian, Mr. Wu Dingfu, Mr. Guo Shuqing and Mr. Fan Gang. Mr. Zhu Zhixin and Mr. Liu Mingkang provided written comments. Committee members Mr. You Quan and Mr. Shang Fulin were absent on leave. Presidents of the PBC Tianjin Branch, Shenyang Branch and Chengdu Branch also attended the meeting.

Source: www.pbc.gov.cn