China's Central Bank Commits to Moderately Loose Monetary Policy

China's central bank has reaffirmed its commitment to a moderately loose monetary policy aimed at fostering economic growth and managing risks in light of ongoing market fluctuations.

In its latest report regarding monetary policy implementation for the fourth quarter of 2025, the People's Bank of China (PBOC) outlined its strategy to adapt the strength, pace, and timing of policy measures to align with evolving domestic and global economic conditions.

The PBOC noted that throughout last year, it executed a series of monetary and financial initiatives designed to enhance countercyclical adjustments, thereby supporting the real economy and ensuring the stability of financial markets.

According to the report, financial aggregates grew at a relatively brisk pace in 2025, with a continuous improvement in the credit structure. Notably, lending in priority sectors such as technology, green development, inclusive finance, elderly care, and the digital economy outpaced overall loan growth.

Looking forward, the central bank emphasized its intention to bolster financial support for essential sectors, particularly domestic demand, technological innovation, and the sustainability of micro, small, and medium-sized enterprises.

Additionally, the PBOC signaled its commitment to refining its macroprudential and financial stability policy toolkit, while simultaneously implementing measures to mitigate systemic financial risks.