Reuters:

The Central Economic Work Conference stressed that the prudent monetary policy should be targeted and effective this year, with reasonable and sufficient liquidity to be maintained. In this context, is there room to further cut interest rates and RRR? Will structural tools be used more? Thanks.

Xuan Changneng:

As mentioned in my opening remarks, the prudent monetary policy aims to ensure better coordination in expanding domestic demand and advancing supply-side structural reform. On the one hand, we will make efforts to support the expansion of domestic demand. Reasonable and ample liquidity will be maintained. Financial institutions will be guided to act in accordance with the market-oriented and law-based principle, and properly manage the scale and pace of granting credit. We will put forward measures in a timely manner so that they will produce effects early on. The prudent monetary policy will proactively coordinate with fiscal and social policies, providing greater support for enterprises to stabilize and expand employment and for key groups to start businesses and find jobs, and increasing the incomes of urban and rural residents in multiple channels. We will ensure strong support for the aggregate demand of society, but in a reasonable and appropriate way. A deluge of strong stimulus policies will be avoided. We will work to ensure the balance between stabilizing growth, employment and price. On the other hand, we will give better play to the guiding role of structural monetary policy instruments. We will continue to make better use of the carbon emission reduction facility and the central bank lending for sci-tech innovation and others. Support will be provided for accelerating the building of a modern industrial system. Preferential policies, such as the instrument supporting inclusive loans for micro and small businesses, will be better implemented. Strong support will be given to the construction of key infrastructure and major projects in areas such as energy, transportation and water conservancy. Financial services for rural revitalization will be enhanced. We will work to achieve a high level dynamic equilibrium between effective supply and demand.

Currently, as epidemic prevention and control measures have been optimized and economic circulation has returned to normal, the confidence of micro entities will be gradually restored and their vitality gradually unleashed. We will take more measures to boost market confidence and stimulate the vitality of micro entities. First, we will work to lower the overall financing costs for businesses, reduce costs for personal consumption, and alleviate the debt burden for micro entities to improve people's spending power and enterprises' investment capacity. Second, we will stay committed to unswervingly consolidating and developing the public sector and unswervingly encouraging, supporting and guiding the development of the non-public sector. We will guide financial institutions to strengthen and refine financial services, step up support for private micro and small enterprises in the manufacturing and service sectors, and further promote the instrument supporting debt financing of private enterprises. Third, we will encourage spending on housing, automobiles, and other big-ticket items, and strengthen comprehensive financial support for services consumption with a focus on key areas such as education, culture and sports. Fourth, we will maintain financing for the real estate sector in a steady and orderly manner. Guided by the principle that houses are for living in, not for speculation, we will adopt city-specific measures to implement a differentiated housing credit policy. We will make full use of policy instruments, including a special lending facility to ensure the delivery of pre-sold housing projects and loan programs to support pre-sold housing project delivery, to protect the legitimate rights and interests of homebuyers. We will carry out programs to improve the balance sheets of quality real estate enterprises and take effective measures to prevent and diffuse risks for quality leading real estate enterprises. We will improve financial policies to support rental properties and advance a smooth transition of the real estate sector to a new model of development. Thank you.

Zou Lan:

I would like to make a few more points for your reference. The structural monetary policy instruments that have been mentioned have attracted wide attention from all sectors of society. Over the past two years, the PBC has conscientiously implemented the decisions and plans of the CPC Central Committee and the State Council, giving full play to the role of the monetary policy in adjusting both the aggregate and structure. Structural monetary policy instruments have been frequently applied. Especially since last year, many monetary policy instruments have been introduced. Generally, structural monetary policy instruments focus on key sectors, adopt reasonable and moderate approaches, and build up ample room for maneuvering. As of the end of last year, the outstanding value of structural monetary policy instruments stood at about 6.4 trillion yuan. They have played an active role in guiding financial institutions to ensure appropriate credit supply, allocating more financial resources to key areas and weak links, keeping a steady growth in the aggregate monetary and credit supply, and stabilizing the economy's fundamentals.

China's structural monetary policy mainly focuses on key areas and weak links in the national economy, including inclusive finance, green development, and scientific and technological innovation. Specific structural monetary policy instruments are regularly released on the official website of the PBC. You can keep up to date on them. Recently, we have been working on introducing some other structural instruments. These instruments mainly provide support for ensuring stability in the real estate market, including loan programs to support pre-sold housing project delivery and rental properties. We will release more details after the introduction of these structural instruments.