What did the Central Bank's work conference say: Targeted control is moderately tight

"In the face of the new norm of economic development, we must do our homework well," said the central bank's [Weibo] Working Conference on January 8, 2015, which said that we will continue to implement targeted regulation and control in 2015, financial institutions should be guided to revitalize their inventory and make good use of incremental resources to increase credit support for key fields and weak links.

　　So what new "Lessons" does the Central Bank have in 2015?

"The Central Bank is the core Department of monetary policy regulation and control, providing a good monetary environment for the operation of the whole society. Make solid research on the current economic situation and formulate appropriate monetary policies. Constantly innovating the methods and methods of monetary policy regulation and control. Coordinates with other financial regulatory authorities to ensure the overall economic stability ." Guo TianYong, director of the China Banking Research Center of the Central University of Finance and Economics, [microblogging] told the reporter of the first financial daily.

"The Central Bank's 'homework 'is mainly about the innovation of monetary policy implementation and the use of new tools ." Li Zhiqiang, chief analyst of the Financial Market Department of Minsheng Bank, told this reporter that there are also some reforms to be promoted, such as deposit and insurance systems and exchange rates.

The work meeting of the central bank said: "understanding the new norm, adapting to the new norm, and leading the new norm are the starting point and foothold for further improving macro-control and financial reform and development stability ."

Is the new norm of 2015 a continuation of 2014? What will happen?

Zhang Jun, a senior economist at Morgan Stanley Huaxin securities, told this reporter that the overall economic situation may be more complex in 2015 and the downward trend of the economy will continue. In the first half of 2014, the overall monetary policy was tight, starting from the third quarter, especially in November. For the monetary policy of 2015 to cope with the economic decline, the new norm of monetary policy may be looser.

Guo TianYong told the reporter that the central bank's currency control should be proactive, targeted, and forward-looking under the new normal. On the one hand, the fundamentals of the economy have changed under the new normal. Therefore, we must first adapt to this trend in terms of the currency policy. At the same time, the new norm cannot be said that there are too many fluctuations in the economy, and the monetary policy should also be well grasped. "In my opinion, 2015 is essentially no different. Whether it's speed or the power and structure of economic growth ."

Li Zhiqiang explained to the reporter of the first financial daily that the concept of "New Normal" is itself evolving and will certainly add new content as the overall situation changes in the future, it should be a combination of all the original new development models, including steady growth and restructuring, as well as a series of factors such as making full use of the market, promoting the development of private and small and medium-sized enterprises, and reducing financing costs.

The central bank's work meeting said it would continue to implement a sound monetary policy. Strengthen and improve macro-prudential management, flexibly use a variety of tool combinations, maintain a reasonable and sufficient liquidity of the banking system, and guide the steady and moderate growth of monetary credit and social financing.

"A moderate degree of tightness means that neither water nor constant changes should be made, and flexible adjustments should be made to the economic fundamentals ." Guo TianYong said.

Zhang Jun believes that the central bank is more about the policy stance selected by camera, and adjusts the monetary policy in a timely manner based on the overall economic development trend. In 2015, the Central Bank's overall tone was sound, but it was a camera decision. If the economic data is poor, the easing intensity will increase. If the data is "recovered", the easing intensity will decrease.

The market's judgment on interest rate cut and downgrading is inconsistent with that of the monetary policy trend in 2015.

Li Zhiqiang said that the monetary policy will be further loose in 2015, and the economic growth is still declining. Therefore, "downgrading" is the general direction.

Guo TianYong believes that the central bank's regulation and control in 2015 is still dominated by Total Amount Control, supplemented by targeted control, because monetary policy is a total amount policy rather than a structural policy. "In the short term, the possibility of downgrading is relatively high. Because the Central Bank's new base currency channel has changed, in this case, there is an overall liquidity gap ."

"We will continue to implement targeted regulation and control, and guide financial institutions to revitalize their inventory and make good use of incremental data to increase credit support for key fields and weak links ." The central bank's work meeting said.

Li Zhiqiang explained that inventory expansion is to make the loan or financing structure that is currently released more reasonable as much as possible, and to guide financing to flow in a direction with high efficiency and good efficiency. To make good use of the increment is similar to the inventory, or to make the new investment more efficient.

How was it done in 2014? Guo TianYong believes that, in terms of financing cost reduction, the central bank had some results in 2014, but it was difficult to rely only on the Central Bank. The Central Bank can only adjust the benchmark interest rate level of the society, but it does not lower the benchmark interest rate, and the social financing cost will be lowered. To reduce the cost of social financing, we should not only rely on the central bank's monetary policy tools, but also on deepening financial reform.

Guo TianYong predicts that in 2015, the central bank will continue to reduce the cost of social financing. The central bank will regulate and control the social benchmark interest rate level. The Central Bank also has the organizational and coordination functions in deepening financial reform. (Beijing News)

What did the Central Bank's work conference say: Targeted control is moderately tight