China announces first monetary policy shift since 2010 to spur growth
Business
China will enforce a more proactive policy and step up "unconventional" counter-cyclical adjustments
BEIJING (Reuters) – China will adopt an "appropriately loose" monetary policy next year as part of steps to support economic growth, state media reported on Monday citing a Politburo meeting, marking the first such shift towards loosening since 2010.
China will implement a more proactive fiscal policy and step up "unconventional" counter-cyclical adjustments, Xinhua reported, citing the Politburo.
China must also "vigorously" boost consumption and expand domestic demand "in all directions", Xinhua said.
The remarks came from an official readout of a meeting of top Communist Party officials, the Politburo, and before the annual Central Economic Work Conference later this week to set key targets and policy intentions for next year.
In 2025, authorities must adhere to "the principle of pursuing progress while maintaining stability", leveraging progress to ensure stability and drive innovation, Xinhua said.
"A more proactive fiscal policy and an appropriately loose monetary policy should be implemented, enhancing and refining the policy toolkit, strengthening extraordinary counter-cyclical adjustments," it said.
The new wording for the monetary policy marks the first easing of the stance since late 2010, according to official announcements on the Politburo meetings.
The central bank has outlined five policy stances – “loose”, “appropriately loose”, “prudent”, “appropriately tight” and “tight” – with flexibility on either side of each.
China adopted an “appropriately loose” monetary policy after the 2008 global financial crisis, before switching to “prudent” in late 2010.
