China's central bank vows ample liquidity to support coronavirus-hit economy

China's central bank vowed on June 18 to keep financial liquidity at a reasonable and adequate level in the second half of the year, amid efforts to tackle the impact of COVID-19 on the economy.

The country's new yuan-denominated loans are expected to reach nearly 20 trillion yuan (about $2.82 trillion) this year and the total amount of social financing is poised to exceed 30 trillion yuan, according to Yi Gang, governor of the People's Bank of China.

The figures would represent a 19 percent expansion compared with 16.81 trillion yuan worth of new loans in 2019, and an annual increase of at least 17.28 percent for total social financing.

"China's economic fundamentals remain sound, and its monetary policy is within the normal range," Yi said via a video conference of the Lujiazui Forum.

Yi added that the central bank would further guide the market interest rates to a lower level through interest rate reforms and cut financing costs for enterprises.

He reiterated a statement of the State Council on June 17 that financial institutions would be encouraged to help businesses save 1.5 trillion yuan this year, by lowering interest rates, using monetary policy tools and reducing banks' charges.

"We should pay attention to the side effects of the policies, keep the total amount suitable and consider in advance the appropriate timing of exit for the policy tools," Yi said.