China’s Economy Set to Bounce Back in 2023 with Precise and Forceful Monetary Policy
According to the quarterly policy implementation report released by the People’s Bank of China (PBOC) on Friday, China’s economy is expected to recover in 2023, and the central bank will adopt precise and forceful monetary policies. The report emphasized that the PBOC will concentrate on stabilizing economic growth and prices, supporting domestic demand expansion, and avoiding excessive stimulus measures.
The report also highlighted that the external environment remains challenging, and the fundamentals of domestic economic recovery are not yet secure. Additionally, the property sector requires time to transition, while local governments must balance fiscal revenue and expenditure pressures.
The report further stated that China will closely monitor inflation trends, keeping energy and food prices stable. Although the report has not substantially changed from the previous one, market analysts anticipate the announcement of economic targets and policies for 2023, as well as a government reshuffle of the economic team, during an upcoming annual parliamentary meeting that commences on March 5.
Despite the challenges, Premier Li Keqiang noted at a cabinet meeting on Wednesday that China’s economy is stabilizing and improving. The PBOC will maintain reasonably ample liquidity and ensure effective credit growth, according to the report. Moreover, the central bank is committed to enhancing social expectations and boosting confidence, with a particular focus on stabilizing economic growth, employment, and prices.
