China's central bank said on Monday that it would gradually promote reforms of the yuan's exchange rate regime and improve its foreign exchange management this year.
In a statement distributed at a news conference, the People's Bank of China said it would enhance the yuan's flexibility, while keeping its rate basically stable. It would also study standardized yuan derivative contracts such as forwards.
In wide-ranging comments on its plans for reform, the central bank said it would improve management of its foreign exchange reserves, without giving details.
It also said it would enhance management of cross-border capital flows, especially short-term flows. As part of that, the central bank said it would set up a multi-channel investment system for orderly capital outflows.
The central bank said it would actively, though prudently, push forward with market-orientated interest rate reforms. It would also encourage the issuance of corporate bonds and the development of a short-term financial bills market launched in 2005.
It also said it would do more to open up the country's gold market, while encouraging more product innovation in that market.
It said it would use open market operations and changes in banks' required reserves as part of an array of tools to manage liquidity in the banking system. It would also ease pressure on money supply by adjusting its own lending and discounting policies.
The central bank also said it would keep credit in check by guiding commercial banks concerning the sectors that they should lend to. It added that it would earnestly apply policies to keep the country's property sector sound and healthy.