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CHINA / National

Central bank to try to rein in credit growth
(Reuters)
Updated: 2006-05-22 08:45

China's central bank will try to rein in rapid credit growth and look to fine-tune policy by using a number of tools including an adjustment to bank reserve requirements, it said in comments published over the weekend.

In excerpts from its 2005 annual report, it also said it would continue to push reforms of its exchange rate and keep the yuan basically stable, the official China Securities Journal said in a reiteration of long-standing policy.

The central bank also outlined a number of economic risks including the possibility that fixed-asset investment could rebound and that prices would be influenced by both overcapacity in certain industries and energy price reforms.

Prices in China would be subject to both inflationary and deflationary pressures, the paper cited the report as saying.

It also saw the potential for bad loans to swell and for financial risks to grow, it said.

 
 

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