The advisory body of China's central bank suggested Monday that the
interest rate and exchange rate of Renminbi should continue to
remain stable.
The Monetary Policy Committee of the
also suggested at its regular meeting for the second quarter that
the market-oriented reform of interest rates should proceed in a
steady way.
The meeting held that so far this year China's economic development
had been good despite the unexpected impact of severe acute
respiratory syndrome (SARS). The central bank continued to
implement prudent monetary policies and operate various financial
services to fight the disease.
By
the end of May, the outstanding broad money (M2) was 20 trillion
yuan (US$2.42 trillion), up 20.2 percent from the same period last
year; outstanding loans were 14.4 trillion yuan, a rise of 1.26
trillion yuan from the beginning of the year, indicating that
China's financial industry is operating smoothly, according to the
meeting.
The meeting analyzed the current domestic and international
economic and financial situations, and discussed policy measures to
be taken.
Members of the committee held that China should continue the policy
of expanding domestic demand, continue to implement prudent
monetary policies, maintain the continuity and stability of
monetary policies, adopt various monetary policy tools in a
flexible way, reinforce open market operations, maintain steady
growth of money supply and protect the good momentum of economic
and financial development.
The meeting cautioned that efforts should be made to prevent
potential financial risks in the real estate sector and repetitive
construction projects, step up loan risk alarm and supervision
mechanisms and further rationalize loan structures, so as to
prevent new financial risks.
(Xinhua News Agency June 24, 2003)