Monetary flexibility still at China’s disposal during trade war, says Yi

The governor of the People’s Bank of China Yi Gang has said there remain opportunities for tweaking interest rates and the reserve requirement ratio (RRR), Reuters reports, as the country’s economic headwinds begin to swirl faster.

The bubbling trade war with Washington has presented China with “tremendous uncertainties” to which it was searching for a “constructive solution”, Yi said at the IMF and World Bank talks in Bali.

“We still have plenty of monetary policy instruments in terms of interest rate policy, in terms of RRR. We have plenty of room for adjustment, just in case we need it,” said Yi.

Yi added that China will meet and perhaps slightly exceed its annual growth target of 6.5% this year, and that inflation levels were not a cause for a concern.