Written by Reuters
20 Jun, 2018 | 11:05 am
REUTERS – China’s central bank governor Yi Gang Tuesday expressed confidence in the country’s capital market, saying that China’s sound economic fundamentals and growth resilience have provided the conditions for a healthy development.
Yi said in an interview with the press that the fluctuations in the stock markets in China and in the region were mainly the result of the influence of investors’ sentiment. A market has its rises and falls. Investors should view it with a cool mind and rationality.
Yi said Currently China’s economic fundamentals are sound and the resilience of economic growth has increased. The total supply and demand are more balanced and the shift of growth drivers has been accelerated. The Chinese yuan is one of the few currencies that have appreciated against the U.S. dollar since the beginning of this year. Based on such economic fundamentals, I’m fully confident that China’s capital market has the conditions for a healthy development.
Besides, Yi said, the domestic demand has in recent years been pulling the economy up and the trade dependency declined from 64% in 2006 to 33% last year, lower than the world’s average of 42%. The proportion of surplus in the current account in GDP also dropped from 2007’s about 10% to 1.3% last year. China’s ability to cope with external impact has been growing. China boasts a big market with a population of 1.3 billion. Its endogenous potential is huge. China has the full conditions and space to cope with all kinds of trade frictions.
Yi said the People’s Bank of China has always been alert against external impact. It will do well in its forward-looking policy reserves and employ all kinds of monetary policy tools to keep the liquidity rationally stable and maintain the structurally deleveraging strength and rhythm so as to bring about a steady and healthy development of the economy and hold on firmly to the bottom-line of no systemic financial risks.
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