China's central bank aims to boost real estate market
Focus on healthy development
China's central bank has vowed to promote the healthy development of the Chinese real estate market by protecting the legal rights of home buyers and better meeting their decent living needs.
The People's Bank of China (PBOC) statement, issued after Saturday's fourth-quarter monetary policy committee meeting, is the latest sign that Chinese regulators are slightly easing restrictions on the property sector for a hard landing impede.
Following on from China's annual central economic conference held in early December, the PBOC said it would prioritize economic stability in an increasingly difficult external environment and the relentless global pandemic.
"The PBOC ... became more cautious about its growth prospects, indicated an intention to deploy diversified and targeted policy tools to support the real economy in a more proactive manner, and marginally softened its tone on the real estate sector," the analysts said from Goldman Sachs (NYSE: GS) in a note on Sunday.
"We expect the central bank to provide more long-term liquidity through RRR cuts and various credit facilities, that household spending will be more growth-inducing compared to 2021, and that local governments will loosen their property policies at the local level.
The PBOC said it would be flexible and reasonable in its monetary policy and maintain adequate liquidity. It will increase support for the real economy, with a focus on small businesses.
The central bank reiterated that it will deepen currency market reforms and increase the flexibility of the yuan exchange rate while guiding corporations and financial institutions to be "risk neutral".