China to maintain prudent monetary policy in 2013

China will maintain a proactive fiscal policy and prudent monetary policy in 2013, according to a statement issued Sunday after the closure of a two-day central economic work conference.

The country will “properly expand the amount of social financing to maintain a moderate increase in loan issuances” and keep the yuan’s exchange rate “basically stable” next year, according to the statement.

The conference, which sets the tone for economic policymaking in the year ahead, also resulted in an agreement to guard against potential risks in the country’s fiscal and financial sectors, it said.

China has kept a proactive fiscal policy since late 2008, when the country unveiled a 4-trillion-yuan (634.92 billion U.S. dollars) stimulus package to counter the adverse impact of the global financial crisis. Its monetary policy has been prudent since late 2010.

The country’s annual economic growth slipped to 7.4 percent in the third quarter this year, slowing for seven quarters in a row.

To spur growth, China’s central bank twice trimmed benchmark interest rates and commercial banks’ reserve requirement ratios in the first seven months of the year. But it has since resisted further cuts, preferring to use open market operations instead.

Xinhua