Chinese officials speak at a press conference on financial support for high-quality economic development, Beijing, China, January 14, 2025. /CFP

China's central bank will implement a "moderately loose" monetary policy and keep the exchange rate of the yuan basically stable at a reasonable and balanced level this year, said a People's Bank of China (PBOC) official at a press conference in Beijing on Tuesday.

Overall, the country's monetary policy yielded favorable results over the past year with credit and liquidity growing reasonably, said Xuan Changneng, deputy governor of the PBOC.

PBOC: Monetary policy yielded good results in 2024

By the end of December last year, total social financing - a broad measure of credit and liquidity in an economy - expanded by 8 percent year on year, PBOC data showed on Tuesday. China's yuan-denominated loans rose by18.09 trillion yuan ($2.52 trillion) in 2024, while the broad money supply, or M2, increased by 7.3 percent as of the end of December.

Meanwhile, the renminbi has remained basically stable under complex circumstances, said Xuan. The Chinese currency has performed relatively well among major currencies, playing a positive role in stabilizing the economy and trade, he said.

By the end of 2024, the China Foreign Exchange Trade System yuan exchange rate composite index, which measures the yuan's exchange rate changes against a basket of currencies, stood at 101.47, up 4.2 percent compared to the end of the previous year, according to Xuan. 

A view of the People's Bank of China headquarters, Beijing, China, January 10, 2025. /CFP

PBOC: Counter-cyclical adjustments to be strengthened in 2025

Going forward, the PBOC will strengthen counter-cyclical adjustments based on the economic and financial situation of the country as well as external factors.

"Based on evolving domestic and global economic conditions, as well as financial market dynamics, we will fine-tune the intensity and timing of policy measures as needed to support the achievement of economic and social development goals," said Xuan.

A combination of monetary policy tools will be utilized to maintain sufficient liquidity and foster a supportive environment for financing, he added.

The office building of the State Administration of Foreign Exchange, Beijing, China, September 21, 2024. /CFP

Regulators confident of yuan stability

Meanwhile, Li Bin, deputy head of the State Administration of Foreign Exchange, said that the renminbi is well-positioned to maintain its stability, adding that the foreign exchange regulator expects a robust rebound in the Chinese economy, stable overall balance of international payments and the growing resilience of the foreign exchange market.

Meanwhile, Xuan said a comprehensive approach will be adopted to strengthen the resilience of the foreign exchange market, stabilize market expectations and enhance market oversight. Actions will be taken to correct pro-cyclical behaviors, address disruptions to market order and proactively mitigate the risk of excessive fluctuations in the yuan's exchange rate, he added.

Source: CGTN