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China considering measures to adjust lending rates for companies: central bank official

Reuters  |  SHANGHAI 

(Reuters) - is considering measures to drive adjustments in financial institutions' lending rates for companies to improve credit flow into the economy, the official English-language Daily reported on Thursday, citing a official.

Sun Guofeng, of the People's Bank of China's monetary policy department, said that despite rising expectations of a interest rate cut, it is "more urgent" to allow financial markets, rather than the PBOC, to determine lending rates.

Policymakers should assess domestic macroeconomic conditions to reduce financing costs before pursuing more interest rate reform, the paper said.

"We hope (policy fine-tuning) will not surprise the market when it is introduced," it quoted Sun as saying.

"The PBOC has good communication mechanisms with other central including the and the European Central Bank," Sun said, noting that communication with other countries is needed before introducing new policies or ""

Chinese authorities have struggled to increase lending to try to boost China's slowing economy, which has been hit by weak domestic demand and the trade war with the But they have shied away from aggressive easing, including benchmark interest rate cuts, amid concern that doing so could put pressure on China's yuan.

In 2018, China's grew 6.6 percent, its slowest pace in 28 years, weighed down by weak investment and faltering consumer confidence. Growth is expected to slow further to 6.3 percent this year.

(Reporting by Andrew Galbraith; Editing by Sam Holmes)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, February 14 2019. 06:35 IST