Central Bank: Continue to Implement Moderately Loose Monetary Policy

TechFlow news, August 02, the People's Bank of China held a work meeting for the second half of 2026. The meeting pointed out that it will continue to implement a moderately loose monetary policy. Various monetary policy tools such as reverse repos, medium-term lending facilities, and buying and selling government bonds will be comprehensively employed to provide short-, medium-, and long-term liquidity, maintain ample liquidity, and guide financial institutions to strongly support the effective financing demands of the real economy. The short-end interest rate regulation mechanism will be improved, the varieties of overnight reverse repo operations increased, and the interest rate range for temporary overnight repo/reverse repo operations narrowed.

Implementation and supervision of interest rate policies will be strengthened, financial institutions urged to clearly disclose the comprehensive financing costs of loans, and comprehensive social financing costs kept running at a low level. Effective market communication and expectation guidance will be ensured. At the end of June, the total social financing scale increased by 7.4% year-on-year, and the broad money supply increased by 8.0% year-on-year. The decisive role of the market in exchange rate formation will be adhered to, with the RMB exchange rate fluctuating in both directions. (Jin10)