The People's Bank of China stated that it will continue to implement a moderately loose monetary policy, leveraging the combined effects of incrementa...

[PBOC: Continue to Implement Moderately Loose Monetary Policy, Leverage the Integrated Effect of Incremental and Existing Policies] According to Mars Finance, citing Jinshi, the People's Bank of China (PBOC) held its 2026 Working Conference on January 5-6. The conference emphasized continuing to implement a moderately loose monetary policy, leveraging the integrated effect of incremental and existing policies, increasing counter-cyclical and cross-cyclical adjustments, improving the quality and efficiency of financial services for the high-quality development of the real economy, deepening financial reform and higher-level opening-up, enhancing the forward-looking, targeted, and coordinated nature of macro policies, focusing on expanding domestic demand and optimizing supply, preventing and resolving risks, and stabilizing social expectations. This will create a favorable monetary and financial environment for stable economic growth, high-quality development, and the stable operation of the financial market, providing strong financial support for a good start to the 15th Five-Year Plan. Furthermore, the conference stressed that promoting high-quality economic development and a reasonable recovery in prices should be important considerations for monetary policy. It called for the flexible and efficient use of various monetary policy tools, such as reserve requirement ratio (RRR) cuts and interest rate cuts, to maintain ample liquidity, relatively loose social financing conditions, and guide reasonable growth in total financial volume and balanced credit allocation, ensuring that the growth of social financing and money supply matches the expected targets for economic growth and the overall price level. We will ensure the smooth transmission mechanism of monetary policy, give full play to the guiding role of policy interest rates, and effectively implement and supervise interest rate policies to promote low overall social financing costs. We will orderly expand the coverage of the disclosure of comprehensive financing costs for corporate loans and promote the disclosure of comprehensive financing costs for personal loans. We will maintain the basic stability of the RMB exchange rate at a reasonable and balanced level and prevent the risk of exchange rate overshooting.