China News Service, May 10, according to the official WeChat news of the People's Bank of China, the People's Bank of China released the "China Monetary Policy Implementation Report for the First Quarter of 2020" on the 10th. According to reports, overall, the sound monetary policy has achieved remarkable results and the transmission efficiency has been significantly improved. In the next stage, the prudent monetary policy should be more flexible and appropriate. According to the epidemic prevention and control and the staged changes in the economic situation, we must grasp the policy strength, focus and rhythm.
According to reports, the sudden new coronary pneumonia epidemic in the first quarter of 2020 has brought unprecedented impact on China's economic and social development. Under the strong leadership of the Party Central Committee, the people of the whole country have worked together and worked hard. The epidemic prevention and control battle has achieved major strategic results. The overall promotion of epidemic prevention and control and economic and social development has achieved positive results. In the normalization of epidemic prevention and control, economic and social operations have gradually As normal, the order of production and life is speeding up. In the first quarter of 2020, gross domestic product (GDP) fell 6.8% year-on-year, and the consumer price index (CPI) rose 4.9% year-on-year. The employment situation is generally stable, the foreign trade structure continues to improve, and the balance of payments remains basically balanced.
The People's Bank of China resolutely implements the decision-making and deployment of the Party Central Committee and the State Council, acts quickly, and takes proactive actions. The prudent monetary policy is more flexible and appropriate. The epidemic prevention and control are the most important tasks. , Comprehensive use of multiple tools to effectively respond to the impact of the epidemic.
One is to maintain reasonable and sufficient liquidity. The reduction of the deposit reserve ratio three times this year has released 1.75 trillion yuan of long-term funds, and short-term liquidity of 1.7 trillion yuan has been invested after the Spring Festival. Reasonably grasp the operation strength and rhythm of the open market and maintain the stable operation of the financial market.
The second is to increase monetary credit support to hedge against the impact of the new coronary pneumonia epidemic. Set up a special re-loan of 300 billion yuan to support key areas and key enterprises in epidemic prevention and control, increase the special line of 500 billion yuan for refinancing and re-discount to support the orderly resumption of production and production, and increase the re-discount line of 1 trillion yuan to support economic recovery development of.
The third is to ease the transmission of monetary policy through reforms. Deepen the reform of interest rate marketization, promote the promotion and application of the quoted interest rate (LPR) in the loan market, promote the conversion of the stock floating rate loan pricing benchmark, and reduce the actual interest rate of loans.
The fourth is based on me, taking into account the external balance. The RMB exchange rate is generally stable, and the two-way floating elasticity is enhanced. Cross-border capital flows and foreign exchange supply and demand are basically balanced. Fifth, firmly adhere to the bottom line of risk and effectively prevent and control financial risks.
On the whole, the sound monetary policy has achieved remarkable results, and the transmission efficiency has been significantly improved, reflecting forward-looking, precision, initiative and effectiveness. At the end of March, Broad Currency (M2) increased by 10.1% year-on-year, the stock of social financing increased by 11.5% year-on-year, and the scale of M2 and social financing grew steadily. In the first quarter, the cost of social financing declined significantly. The average interest rate of general loans in March was 5.48%, a decrease of 0.62 percentage points from July 2019 before the LPR reform. The monetary and credit structure was further optimized, and inclusive small and micro loans "increased in volume, decreased in price, and expanded in area." The renminbi exchange rate floats in both directions, and market expectations are stable. At the end of March, the China Foreign Exchange Trading Center (CFETS) RMB exchange rate index reported at 94.06, an appreciation of 2.92% over the end of the previous year.
The international epidemic has continued to spread, the world economy has entered a recession, and instability and uncertainty have increased significantly. The trend of China's economic stability is improving and long-term improvement has not changed. However, the current challenges facing China's economic development are unprecedented. It is necessary to fully estimate the difficulties, risks and uncertainties, effectively enhance the sense of urgency, and do a solid job in economic and social development.
In the next stage, the People ’s Bank of China will resolutely implement the decision-making and deployment of the Party Central Committee and the State Council, coordinate the advancement of epidemic prevention and control and economic and social development, and under the premise of normalization of epidemic prevention and control, adhere to the general tone of progress and steady development Philosophy, do a good job of "six stability", fully implement the "six guarantees" task, ensure the completion of the task of decisive battle to overcome poverty, and build a well-off society in an all-round way.
A sound monetary policy should be more flexible and appropriate. According to the epidemic prevention and control and the staged changes in the economic situation, we must grasp the policy strength, focus and rhythm. Strengthen the counter-cyclical adjustment of monetary policy, place support for the recovery of the real economy in a more prominent position, use aggregate and structural policies to maintain reasonable and sufficient liquidity, and support the real economy, especially small and medium-sized enterprises, to overcome difficulties. Give full play to the traction and driving role of the re-loan and discount policy, and provide accurate financial services for epidemic prevention and control, resumption of production and real economy development.
Deal with the relationship between steady growth, job security, structural adjustment, risk prevention, and inflation control, keep the price level basically stable, and do a good job of anticipating and guiding through multiple channels. Promote banks 'multi-channel replenishment of capital, enhance banks' ability to serve the real economy and prevent financial risks. Continue to deepen the reform of the quoted interest rate in the loan market, orderly advance the conversion of the benchmark pricing of stock floating interest rate loans, unblock the transmission mechanism of monetary policy, and guide the interest rate of the loan market to decline. Coordinate local and foreign currency policies and handle the balance between the domestic economy and the foreign economy. We must grasp the balance of maintaining the flexibility of the RMB exchange rate, improving the macro-prudential policies for cross-border capital flows and strengthening international macro-policy coordination, and keeping the RMB exchange rate basically stable at a reasonable and balanced level.