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Analysts: China to continue 'steady' monetary policy

Analysts: China to continue 'steady' monetary policy

Write: Tanner [2011-11-29]

Analysts: China to continue 'steady' monetary policy

Consumers select vegetables at a market in Nanjing, capital city of east China's Jiangsu Province, Oct. 14, 2011. [Photo/Xinhua]

China's annual Central Economic Work Conference will be held in December to set tone for economic development next year. Analysts believe China will continue to carry out "steady" monetary policy and proactive fiscal policies in 2012, China Securities Journal reported.

Lu Zhengwei, chief economist at Industrial Bank Co., said China will see faster money supply growth in the first quarter of next year, but will probably not cut the reserve requirement ratio this year. Reductions in reserve requirements are likely to happen next year, he added.

Lu also said that the country is likely to give financial institutions greater autonomy in determining interest rates.

The country's fiscal policies will focus on structural tax reductions, the analysts predicted. Jia Kang, a senior policy research with the Ministry of Finance, said China's preferential tax policies should benefit more small firms and grassroots entrepreneurs.

The People's Bank of China (PBOC), the country's central bank, said recently it will maintain current monetary policies while making them more targeted and flexible.

China's business press carried the story above on Monday.