Economy

PBOC: Arduous task of macro control ahead

(Xinhua)
Updated: 2010-01-29 22:47

BEIJING: China is facing more "arduous" task of maintaining sound and relatively fast economic growth in 2010 as macro-control would be more complicated amid rising inflation fears, the central bank said on Friday.

"China faces daunting task of keeping stable prices, improving credit structure, preventing systematic financial risks and maintaining international balance of payment," the People's Bank of China (PBOC) said in a quarterly economic review posted on its Web site.

The economic recovery will continue to consolidate in 2010 as private investment is expected to strengthen and corporate profit is to improve, it said.

PBOC noted it will keep the relatively easy monetary policy, and also reaffirmed the policy will be consistent and stable, while also more flexible and targeted.

China's economic growth quickened to 10.7 percent in the fourth quarter boosted by strong government-led investment and record bank credit.

As GDP resumed double-digit growth, the consumer price index added 1.9 percent in December, the second monthly rise after ending nine months of decline in November.

Prices face upward pressure in 2010 on rising commodity prices, ample credit growth, stronger domestic demand and more liberalized domestic resource prices, it said.

However, it also noted abundant supply of grain and other consumer products, and the overcapacity in some industries will curb price hikes.

The central bank restated it will maintain ample credit supply while also improve credit structure and keep even pace of credit growth, after the 9.6 trillion yuan of new loans issued in 2009 intensified risks of bad loans and asset bubbles.