China Central Bank Vows to Rein in Stimulus as Economy Recovers


China’s central bank has pledged to take a light-touch approach, avoiding a “flood” of stimulus, as it predicts a steady economic recovery for the country throughout the rest of the year.

In its quarterly policy implementation report released on Friday, the People’s Bank of China (PBOC) said its monetary policy will be precise and forceful and will focus on supporting domestic demand expansion and stabilising economic growth and prices. It will avoid “flood-like” support, it promised.

However, it admitted that the external environment remains “severe and complex”, adding the basics of domestic economic recovery are “not solid”. 


Also on AF: Asian Stocks Mixed on Superpower Tensions, BOJ Policy Signs


The report also said that the property sector requires time to transition while the pressure of balancing local government fiscal revenue and expenditure persists.

China will closely watch the trend and changes in inflation and look to keep the prices of energy and food stable, said the report.

The world’s second-largest economy is stabilising and improving but still faces many challenges, Premier Li Keqiang said at a cabinet meeting on Wednesday, after the country’s economic growth slowed to one of the worst levels in half a decade due to stringent Covid-19 lockdowns and curbs in 2022.

The PBOC will keep liquidity reasonably ample and maintain effective credit growth, according to the report.

The central bank also pledged to start improving social expectations and boosting confidence, mainly focusing on stabilising economic growth, employment and prices.

As the problematic property sector has showed a tentative recovery, the PBOC said it will satisfy reasonable financing demand in the sector but insist on not using real estate as a short-term means to stimulate the economy.


  • Reuters with additional editing by Sean O’Meara


Read more:

Morgan Stanley Upgrades China 2023 Growth, Yuan Forecasts

China 2023 Earnings Forecasts Lifted by Reopening Boost Hopes

China Industrial Profits Drop Further, But Growth Seen in 2023



Sean O'Meara

Sean O'Meara is an Editor at Asia Financial. He has been a newspaper man for more than 30 years, working at local, regional and national titles in the UK as a writer, sub-editor, page designer and print editor. A football, cricket and rugby fan, he has a particular interest in sports finance.

Recent Posts

China’s Shenzhou-16 Rocket Takes Astronauts up to Space Station

The astronauts will replace the three-member crew of the Shenzhou-15, who arrived at the space…

4 hours ago

Singapore Ousts Hong Kong as APAC’s Costliest City for a Home

A heavy influx of immigrants and a trend among young professionals to move out of…

4 hours ago

Elon Musk Reaches China, Meets Foreign Minister Qin Gang

The trip is Musk's first to China since he made headlines in early 2020 by…

6 hours ago

Japan Plans to Beam Solar Power From Space by 2025 – engadget

The country made a breakthrough in space-based solar energy back in 2015 and now says…

6 hours ago

India May Cut Import Tax on Solar Panels Amid Domestic Shortage

Government sources said the import tax may be halved, and GST cut, because local producers…

7 hours ago

China Strains, AI Top of The Agenda at US, EU Summit Talks

A 24-page draft joint statement focuses on AI algorithm standards, export controls and China’s non-market practices and disinformation

8 hours ago