China will not resort to quantitative easing, central bank chief Yi Gang says
- ‘We should not let the money held by the Chinese people become worthless,’ People’s Bank of China governor Yi Gang says
- Beijing will not resort to a competitive devaluation of the yuan
The head of China’s central bank said in a signed article published on Sunday that Beijing should maintain a “normal” monetary policy as long as possible as economic growth is still within a reasonable range and inflation is mild overall.
“We should not let the money held by the Chinese people become worthless,” he said. “Maintaining positive interest rates and an upwards inclined yield curve is generally conducive to the economic entities, and in line with the Chinese people’s saving culture, thus beneficial to the sustainable development of the economy.”
He said also that the central bank would continue to implement a prudent monetary policy, conduct countercyclical adjustments, improve monetary policy transmission and keep liquidity reasonably ample.
China’s economic growth slowed to a near 30-year low in the third quarter and industrial profits continued to shrink. As a result, speculation is mounting that Beijing needs to roll out stimulus more quickly and more aggressively, even if it risks adding to a pile of debt.
