China's central bank said today it it would take further steps to curb money supply and credit growth.
The central bank, which issued a brief statement following a recent quarterly monetary policy meeting, said it would curb credit growth further but gave no details.
It also repeated its standard commitment to keeping monetary policy and the yuan currency basically stable.
The People's Bank of China said it would let market demand and supply play a fundamental role in determining the level of the yuan exchange rate.
It would "strengthen the management of liquidity in the banking system and further restrain excessive growth in money supply and credit".
It would also continue to give guidance to the country's commercial banks to maintain reasonable growth of medium- to long-term loans, it said.
The central bank has allowed the yuan to appreciate 1.34 per cent since its 2.1 per cent revaluation last July, a far smaller amount than critics in Washington, who have long argued that the currency is vastly undervalued, would like to see.
The central bank surprised markets after it raised the proportion of money that banks must keep in reserves by half a percentage point on Friday, effective July 5th.