China News Service, September 16th. On the 16th, the "People's Bank of China" public account released an article introducing that since the 19th National Congress of the Communist Party of China, as my country's economy has entered a stage of high-quality development, the People's Bank of China has made appropriate arrangements in accordance with the decisions and arrangements of the Party Central Committee and the State Council. In line with the profound adjustment and changes in the population structure, economic structure, external environment and other factors, we will continue to innovate and improve monetary policy control, and promote the economy to operate within a reasonable range.

1. Steady the word, focus on me, and focus on stabilizing the macroeconomic market

　　In recent years, in the face of the complex and severe international environment and the arduous and arduous tasks of domestic reform, development and stability, and having experienced the severe impact and repeated disturbances of the new crown pneumonia epidemic, the prudent monetary policy has maintained its steadfastness, withstood pressure, adopted scientific policies, and insisted on not engaging in "Flooding the water", not over-issuing currency, without big ups and downs, big gains, but always insisting on keeping the word stable and focusing on me, maintaining a reasonable and stable monetary and financial conditions, and maintaining a stable price situation against the backdrop of high global inflation , supporting the stability of the macroeconomic market.

The first is to maintain the stability of the growth of the total amount of money and credit.

A variety of monetary policy tools will be used comprehensively to keep the liquidity of the banking system reasonably sufficient.

Since 2018, the People's Bank of China has lowered the deposit reserve ratio 13 times, releasing 10.8 trillion yuan of long-term funds and supporting financial institutions to increase credit support for the real economy.

Extending time and across cycles to maintain M2 and social financing growth rates that basically match the nominal economic growth rate, rather than matching every year or even quarterly.

From 2018 to 2021, the average growth rate of my country's M2 is 9%, which is roughly equivalent to the average growth rate of nominal GDP of 8.3% in the same period. It not only maintains a stable financial support for the real economy, but also avoids flooding, and the macro leverage ratio is basically stable.

The second is to continue to promote the steady and moderate decline of the financing cost of the real economy.

Interest rate is the price of capital, which has important guiding significance for macroeconomic equilibrium and resource allocation.

In recent years, the People's Bank of China has adapted to potential changes in economic growth, reasonably grasped the macro interest rate level, and continued to deepen the reform of interest rate marketization, improve the formation and transmission mechanism of market-oriented interest rates, advance the reform of the loan market quoted rate (LPR), and establish a market-oriented deposit interest rate. Adjust the mechanism to promote stable and moderate real loan interest rates, and create suitable interest rate conditions for the development of the real economy.

In July 2022, the one-year LPR was 3.65%, down 70 basis points from the beginning of 2018; the corporate loan interest rate was 4.15%, down 116 basis points from the beginning of 2018, the lowest level since statistics.

The third is to strengthen support for key areas, weak links and industries affected by the epidemic.

Innovate and use structural monetary policy tools, improve the incentive compatibility mechanism, and guide financial institutions to continue to provide credit support to small and micro enterprises, green development, technological innovation, manufacturing and other fields.

Make good use of the re-lending to support agriculture and small businesses, expand the scope of re-lending to support small and medium-sized enterprises and support enterprises, and reduce the interest rate of re-lending to support agriculture and small businesses.

Create inclusive small and micro loan support tools, carbon emission reduction support tools, and support for clean and efficient use of coal, technological innovation, inclusive pensions, and special re-loans for transportation and logistics.

Deferred repayment of principal and interest will be implemented for micro, small and medium-sized enterprises, individual industrial and commercial households, truck driver loans, and personal housing and consumer loans affected by the epidemic.

At the end of July 2022, the balance of inclusive small and micro loans was 21.9 trillion yuan, 2.7 times that of the beginning of 2018; the inclusive small and micro loans supported 52.55 million small and micro business entities, 2.5 times that of the beginning of 2018; the financing cost of small and micro enterprises Significant downturn, the problem of "financing difficult and expensive" has eased.

Fourth, keep the RMB exchange rate basically stable at a reasonable and balanced level.

In recent years, the RMB exchange rate has been determined by the market and maintained flexibility. It has played the role of an automatic stabilizer for adjusting the macro economy and the balance of payments, and has better promoted internal and external balance.

Appropriate use of foreign exchange deposit reserve ratio and other tools in a timely and appropriate manner, adhere to the principle of risk neutrality and actual demand in foreign exchange transactions, establish and improve the "macro-prudential + micro-supervision" two-in-one management framework for cross-border capital flows, effectively manage expectations, and the two-way fluctuation of RMB exchange rate , overall stability, no sustained unilateral appreciation or depreciation.

At the end of August 2022, the CFETS RMB exchange rate index was reported at 101.62, an appreciation of 7.1% from the beginning of 2018, which is also in line with the better performance of the Chinese economy in the world over the past few years.

2. Several experiences in innovating and improving monetary policy regulation in recent years

　　In the extremely complex and severe internal and external environment, the prudent monetary policy has been powerful and effective, supported the epidemic prevention and control to achieve positive results, achieved new achievements in economic and social development, and accumulated a lot of valuable experience.

First, adhere to the leadership of the party and adhere to the principles of marketization and the rule of law.

Always adhere to the centralized and unified leadership of the CPC Central Committee on financial work, and implement the decisions and arrangements made by the CPC Central Committee on financial work through improving the modern monetary policy framework, dredging monetary policy transmission, and improving the macro-control system.

Adhere to let the market determine the allocation of resources, insist that market entities make independent decisions and take responsibility for their own profits and losses, do not directly interfere with the economic activities of micro entities, and give full play to the role of more than 4,000 financial institutions and millions of bank staff in my country in obtaining market information and allocating financial resources. , and guide financial institutions to optimize the allocation of financial resources in the market competition.

At the same time, better play the role of the government, create a suitable liquidity environment, grasp the interest rate and exchange rate at the macro level, and let the financial water truly flow to the key areas and weak links that the people expect and the society needs, and avoid financial resources from deviating and empty. It reflects the superiority of the socialist market economy.

The second is to focus on strengthening macro policy coordination.

Monetary policy and other macro policies such as finance and industry are coordinated and performed under the leadership of the Party Central Committee and the State Council, focusing on the overall macro situation, coordinating the direction and tight coordination, avoiding situations such as various policies fighting alone and conflicting with each other, and forming policy synergy to achieve Better macro-control effects.

For example, credit is only a channel for the real economy to obtain funds. In terms of serving the real economy, monetary policy is coordinated with fiscal, industrial and other macro policies, which is conducive to enriching the channels for the real economy to obtain financial support.

From January to July 2022, the central bank will pay 1 trillion yuan in profits to support tax rebates, support government bond financing to increase by 2.4 trillion yuan year-on-year, and support policy development banks to set up financial instruments of 300 billion yuan, and further Increase the amount of more than 300 billion yuan to supplement project capital, and increase support for infrastructure construction and major measures.

These measures will also increase the deposit funds in the hands of market players, and strengthen the foundation for economic recovery and development without providing credit.

The third is to use structural monetary policy tools reasonably and appropriately.

In recent years, we have effectively played the role of precise drip irrigation of structural monetary policy tools, focused on serving key areas and weak links such as inclusive finance, green and low-carbon technology, and technological innovation, to meet the inherent needs of high-quality economic development.

The use of tools adheres to market-oriented requirements, with built-in market-oriented incentive mechanisms, and the price of funds is moderately lower than the total amount of tools. By covering part of the risk costs, financial institutions are motivated to optimize the credit structure.

The application of the tool relies on the central role of the bank in the policy transmission, and directly to the entity.

At the end of June 2022, the balance of the People's Bank of China's structural monetary policy tools was 5.4 trillion yuan, accounting for about one-sixth of the total monetary base and at a reasonable level.

Except for re-lending and re-discounting to support agriculture, small and medium-sized enterprises, most of the structural monetary policy tools are phased tools, and they will be withdrawn in time after the completion of the target.

Three, the next step work ideas

　　At present, the external environment facing my country is more complex and severe, and the foundation for domestic economic recovery still needs to be consolidated.

From an international perspective, the global economy is slowing down, inflation is running at a high level, and geopolitical risks persist. Major developed economies have accelerated monetary policy tightening, which has significantly increased the spillover impact on the world.

From a domestic perspective, my country's economy continues to recover, but there are still slight fluctuations, and it is at the most difficult point for economic stabilization.

The fundamentals of my country's long-term economic growth have not changed, and the economy has maintained strong resilience. my country's monetary policy policy space is sufficient, and policy tools are abundant. There are many favorable conditions to promote the economy to remain within a reasonable range.

　　In the next step, the People's Bank of China will continue to implement a prudent monetary policy, adhere to the principle of self-employment, seek progress while maintaining stability, take into account stable employment, stable prices, internal and external balance, strengthen the foundation for economic recovery and development, and avoid flooding. Flood irrigation, not overdraft the future, and take practical actions to welcome the victory of the party's 20th National Congress.

(Zhongxin Finance)

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