China's central bank to maintain neutral and prudent monetary policy, stable yuan

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HONG KONG, Aug 10 (Reuters) - China's central bank said on Friday it would maintain its neutral and prudent monetary policy and enhance flexibility in yuan exchange rate levels, but global trade frictions remained an uncertainty for the global economy.

The People's Bank of China added in its second-quarter monetary policy implementation report that it would take measures to fend off systemic financial risks and maintain ample liquidity in the banking system.

"We will take further effective measures to carry out counter-cyclical adjustments when necessary and regulate macro-prudential policies to maintain stability in the yuan exchange rate levels," it said in the report, posted on its website www.pbc.gov.cn. (Reporting by Lee Chyen Yee in Singapore and Twinnie Siu in Hong Kong; editing by Andrew Roche)