People's Bank of China: Continue to implement a moderately loose monetary policy

Fourth Quarter 2025 Report on the Implementation of China's Monetary Policy: Continue to implement a moderately loose monetary policy. Promote stable economic growth and a reasonable rebound in prices as important considerations for monetary policy. Based on domestic and international economic and financial conditions and the operation of financial markets, grasp the strength, rhythm, and timing of policy implementation. Flexibly and efficiently use various policy tools such as reserve requirement ratio cuts and interest rate reductions to maintain ample liquidity and relatively loose social financing conditions, guiding reasonable growth in the total financial volume and balanced credit allocation, ensuring that the growth of social financing scale and money supply aligns with economic growth and the expected target for the overall price level. Further improve the interest rate adjustment framework, strengthen the guidance of the central bank's policy interest rates, enhance the transmission mechanism for market-oriented interest rate formation, leverage the self-discipline mechanism of market interest rate pricing, strengthen the execution and supervision of interest rate policies, reduce banks' funding costs, and promote low-level operation of the comprehensive financing costs for society. Gradually expand the coverage of the work on the comprehensive financing costs of explicit corporate loans. Effectively implement various structural monetary policy tools, solidly advance the "five major tasks" of finance, and strengthen financial support for key areas such as expanding domestic demand, technological innovation, and small and micro enterprises. Adhere to a market supply-demand basis, adjust with reference to a basket of currencies, and maintain a managed floating exchange rate system, keeping exchange rate flexibility and leveraging the exchange rate as a macroeconomic and international balance of payments automatic stabilizer. Strengthen expectation guidance, prevent exchange rate overshooting risks, and maintain basic stability of the RMB exchange rate at a reasonable and balanced level. Expand and enrich the macro-prudential and financial stability functions of the central bank, improve the toolbox for macro-prudential and financial stability management, maintain financial market stability, and firmly uphold the bottom line of preventing systemic financial risks.

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