PBOC’s Vice-Governor: Monetary policy in 2021 will provide necessary support for economic recovery

Dhwani Mehta FXStreet

The People’s Bank of China’s (PBOC) Vice Governor said Friday, the central bank’s monetary policy in 2021 will provide the support necessary for the economic recovery.

Additional comments

Prudent monetary policy in 2021 will be more flexible, targeted and appropriate.

Monetary policy in 2021 will provide necessary support for economic recovery.

Will prioritize stability in monetary policy, no sudden shift.

End-2020 weighted average corporate lending rate at 4.61%, down by 51 bps from a year ago.

Will stay vigilant against global risks.

Separately, the head of the PBOC’s monetary policy department, Sun Guofeng, made some comments on the yuan exchange rate.

Key quotes

Two-way fluctuations in yuan will become normal going forward.

Will keep yuan basically stable on a reasonable, balanced level.

Yuan's appreciation or depreciation will not be sustained.

Current interest rate levels are appropriate.

Market reaction

The Chinese proxy, the AUD, is little affected by the above comments. AUD/USD was last seen trading near 0.7755, down 0.28% on the day.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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