People’s Bank of China emphasizes monetary policy ‘frequently’… Differentiate from the US

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China’s central bank, which is walking the opposite path to the US, which is moving in the direction of raising interest rates and tightening money lines, emphasized the ‘autonomy’ of its monetary policy.

The People’s Bank of China announced in a press release on its website on the night of the 25th that the 4th quarter Monetary Policy Committee had been held the day before.

China’s Monetary Policy Committee said, “As the global epidemic (COVID-19) continues and spreads, and the external environment becomes more complex and severe, the domestic economy is facing triple pressure: a contraction in demand, a supply shock, and a weakening outlook.” “We must pursue progress in stability while putting this as our top priority,” he said.

Regarding the direction of future monetary policy, the Committee emphasized that the current ‘moderate monetary policy’ should be implemented more flexibly and appropriately, and emphasized the need to strengthen the capacity to support the real economy while enhancing prospects, precision, and autonomy while giving more importance to activeness.

This 4th quarter press release is similar in overall context to the 3rd quarter Monetary Policy Committee press release, but new expressions of ‘autonomy’ and ‘activity’ were added.

The new expression is that the US Federal Reserve (Fed) announced an early end of tapering through the Federal Open Market Committee (FOMC) in December and predicted three interest rate hikes next year. (LPR) was cut sharply.

The People’s Bank of China announced on the 20th that the one-year loan preferential rate (LPR) for December fell 0.05 percentage points from the previous month to 3.80%.

China’s LPR cut, the first in 20 months since April of last year, was made right after President Xi Jinping and other Chinese leaders presented ‘stability’ as the top priority for economic policy amid concerns over a sharp economic slowdown.

In the second half of the year, China’s economy has been rapidly cooling, and several adverse factors, such as the contraction of the real estate industry highlighted by the Hengda default, a sharp rise in global raw material prices, a power crisis, and the deepening of the global spread of COVID-19, have been combined. are receiving

China’s quarterly economic growth, which rose to 18.3% in the first quarter, sank to 4.9% in the third quarter, thanks to the base effect caused by the COVID-19 crisis.

Some experts even predict that the economic growth rate in the fourth quarter could fall to the 2% range.

Therefore, the People’s Bank of China emphasized ‘autonomy’ and ‘activeness’ of monetary policy this time, and the CCP is acutely feeling the need to revitalize the economy ahead of the 20th Party Congress next fall, which will open the door to President Xi’s long term in office. shows

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Reference-news.sbs.co.kr

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