BEIJING, Feb 10 (Reuters) – China’s central bank said on Tuesday it will step up financial support to boost domestic demand, as industrial overcapacity and lacklustre consumption weigh on business confidence and dampen the outlook for growth.
The economy is stable but faces challenges such as “supply being strong while demand being weak”, the People’s Bank of China said in its fourth-quarter monetary policy implementation report.
Chinese policymakers have repeatedly pledged to boost domestic consumption to tackle the imbalance between supply and demand. Growth in China’s retail sales, a gauge for consumption, lagged behind overall GDP expansion in 2025 and the country’s export-driven growth faces uncertainties in a volatile geopolitical environment.
The central bank said it would guide financial institutions to strengthen support for domestic demand, and guide private capital to participate in expanding consumption and investment to jointly stabilise growth.
It also pledged to direct more financial resources to support expanding services consumption.
Driving stable economic growth and a reasonable recovery in prices should be important considerations in monetary policy, the central bank said, vowing to carefully manage the strength, pace and timing of policy implementation.
The central bank also said it would lower banks’ liability costs, increase support for technological innovation and routinely carry out treasury bond trading to manage liquidity.
(Reporting by Yukun Zhang, Ethan Wang and Ryan Woo; Editing by Andrew Heavens and Sharon Singleton)
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