China’s central bank says will maintain ample liquidity, stabilise growth

BEIJING (Reuters) -China’s central bank said on Friday it will maintain ample liquidity, stabilise growth and jobs and focus on expanding domestic demand, as the economy steadily picks up after lifting COVID-19 curbs.

The People’s Bank of China will make its prudent monetary policy precise and forceful and provide strong support for the real economy, the bank said in a statement after a quarterly meeting of its monetary policy committee.

“The domestic economy is showing a recovery trend, but the foundation for recovery is not yet solid,” it said, adding it will “maintain reasonable and sufficient liquidity, maintain reasonable and stable credit growth, and keep growth of money supply and total social financing basically in line with economic growth.”

Recent data shows China’s economy is staging a gradual but uneven recovery, led by consumption, services and infrastructure, but slowing inflation and surging bank savings raise doubts over the strength of a pick-up in domestic demand.

The economy likely grew 4.0% in the first quarter from a year earlier, quickening from 2.9% in the previous three months, according to a Reuters poll. The government has set a modest growth target of around 5% for this year.

The central bank will improve its policy transmission mechanism, adding that efforts should be made to ensure that financial support for private enterprises is in line with their contributions to economic and social development.

It will also boost support for inclusive financing, green development, tech innovation, infrastructure.

China will guide healthy development of financial businesses of platform companies and will effectively fend off risks of premium property firms, the central bank added.

(Reporting by Beijing newsroom and Kevin Yao; Editing by Toby Chopra and Mike Harrison)