The People's Bank of China, China's central bank, Thursday said it
is appropriate to maintain a stable benchmark interest rate of the
Chinese currency, while expanding the trial of a floating rate in
rural credit cooperatives.
According to a quarterly report on the monetary policy published,
the People's Bank of China said the government should do a better
job in implementing its prudent monetary policy in the second half
of this year.
In
the process of guarding against financial risks, efforts should be
made to properly regulate money supply, vigorously optimize the
loan structure, help commercial banks establish and improve the
incentive mechanism on money business, and strengthen the support
of the financial sector to economic development, the central bank
said.
The report stresses the need to maintain a proper growth in loans
through various monetary measures, including the use of the
interest rate as a lever, appropriately broadening the scope of the
experiment with a floating interest rate in rural credit
cooperatives.
It
also calls for a regulation on interbank lending among commercial
banks in a bid to resolve the shortage of capital at some branches
of certain commercial banks.
The report urges commercial banks to continue to provide loans to
individuals for housing and car purchase, education and
re-employment.
(Xinhua News
Agency August 2, 2002)