“In terms of monetary policy, the next step is to strengthen countercyclical adjustments, maintain reasonable and ample liquidity, and provide a sound monetary and financial environment for the real economy,” Pan said. Pan reiterated that China has sufficient policy tools to cope with the pressure, saying that the central bank has more room to support growth than in other major economies. The bank would use tools such as targeted reserve requirement cuts, relending and rediscounting to support key sectors, he said. The cost of special relending, at 300 billion yuan (US$42.95 billion), from the PBOC to commercial banks is relatively low, Pan added. Beijing needs growth of about 5.6 percent this year to fulfil its goal of doubling GDP and incomes over the past decade.

Source: Taipei Times February 07, 2020 15:56 UTC