The People’s Bank of China said it would “firmly stick” to a moderately loose monetary policy this year, the South China Morning Post reported. In a statement on the central bank’s website, Deputy Governor Yi Gang said that the year’s rapid growth in bank lending had “more benefits than drawbacks.” Positive effects included eliminating deflation expectations, stabilizing asset markets, accelerating destocking and increasing confidence in the economy. However, the PBoC’s position puts it at odds with the China Banking Regulatory Commission, which has registered increasing discomfort with rising lending due to fears of a rise in non-performing loans. New loans in the first quarter of the year reached US$670.9 billion, 91.6% of the country’s goal for the entire year.
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