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Speakers:

Mr. Zou Lan, deputy governor of the People's Bank of China (PBC)

Mr. Peng Lifeng, director general of the Credit Policy Department of the PBC

Mr. Yan Xiandong, director general of the Statistics and Analysis Department of the PBC

Ms. Cao Yuanyuan, deputy director general of the Financial Market Department of the PBC

Chairperson:

Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

July 14, 2025

Xing Huina:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). This is a regular briefing on China's economic data. Today, we have invited Mr. Zou Lan, deputy governor of the People's Bank of China (PBC), who will brief you on the implementation of monetary and credit policies and financial statistics in the first half of the year, and also take your questions. Also joining us today are Mr. Peng Lifeng, director general of the Credit Policy Department of the PBC; Mr. Yan Xiandong, director general of the Statistics and Analysis Department of the PBC; and Ms. Cao Yuanyuan, deputy director general of the Financial Market Department of the PBC.

Now, I'll give the floor to Mr. Zou for his introduction.

Zou Lan:

Good afternoon, friends from the media. Thank you for your continued interest in and support for the work of the PBC. It is my pleasure to have this opportunity to brief you on the implementation of monetary and credit policies as well as financial statistics in the first half of the year. My three colleagues and I will also take your questions.

Since the beginning of this year, the external environment has grown even more complicated and challenging, with weakening global growth momentum and a rise in trade protectionism. In line with the guiding principles of the Central Economic Work Conference and the arrangements set out in the Government Work Report, we need to implement a moderately loose monetary policy. During the press conference held in May, PBC governor Pan Gongsheng elaborated on the concept of a moderately loose monetary policy. In short, this means maintaining sufficient liquidity, ensuring favorable social financing conditions, and keeping overall financing costs relatively low. Policy implementation should adapt to changing circumstances in a timely manner and with the appropriate intensity. From an international perspective, China has been continuously lowering the required reserve ratio (RRR) and interest rates, maintaining a supportive monetary policy stance with cumulative effects. Since 2020, the PBC has cut the RRR 12 times and reduced policy interest rates nine times, driving down the one-year and over-five-year loan prime rates (LPR) by 115 and 130 basis points, respectively.

To implement a moderately loose monetary policy, the PBC further strengthened counter-cyclical adjustments and introduced a package of financial support measures in May. A range of monetary policy tools has been utilized in a comprehensive manner to maintain sufficient liquidity and support reasonable growth in money and credit supply. The market-oriented interest rate regulation framework has been improved to enhance the implementation and oversight of interest rate policies and reduce aggregate financing costs. Greater efforts have been made to leverage both the aggregate and structural functions of monetary policy tools, in a bid to further optimize credit structure, enhance coordination between monetary policy and other macro policies, and create synergy to continuously foster a favorable environment for supporting economic recovery and improvement.

Financial data from the first half of the year shows that the monetary policy has had a clear impact in supporting the real economy. First, overall financial aggregate expanded reasonably. By the end of June, the stock of aggregate financing had increased by 8.9% year on year, the M2 money supply increased by 8.3%, and RMB loans increased by 7.1%. If we remove the impact of replacing local government financing vehicle loans with special-purpose local government bonds, the year-on-year growth of loans would have been ever higher on a comparable basis. Second, aggregate financing costs remained low. From January to June, the weighted average interest rate on newly-issued corporate loans stood at around 3.3%, about 45 basis points lower than the same period last year. The interest rate on newly-issued personal housing loans was approximately 3.1%, down about 60 basis points year on year. Third, the credit structure continued to improve. By the end of May, inclusive loans to micro and small businesses had increased by 11.6% year on year, medium- and long-term lending to the manufacturing sector had grown by 8.8%, and lending to the tech sector had surged by 12%. All of these outpaced the overall loan growth. Fourth, the financial market showed increased resilience. Despite significant changes in the external environment and global financial markets, major financial sectors including equities, bonds and foreign exchange have remained stable.

From both economic theory and practical experience, it is clear that the transmission of monetary policies takes time, and the effects of policies already implemented will continue to unfold. Moving forward, the PBC will continue to implement a moderately loose monetary policy, closely monitoring the transmission and actual impact of policies implemented earlier. Based on the economic and financial situation both at home and abroad, as well as the operation of the financial market, the PBC will properly manage the pace and intensity of policy implementation, in a bid to better expand domestic demand, stabilize social expectations, stimulate market vitality, and support the achievement of this year's socioeconomic development goals and tasks.

That's all from me for now. I will leave more time for questions from the floor.

Xing Huina:

The floor is now open for questions. Please state your news organization before asking your questions.