PBOC Monetary Policy Committee Calls for Continued Moderately Loose Policy

The People’s Bank of China (PBOC) Monetary Policy Committee held its second-quarter 2026 meeting (the 113th meeting overall) on July 4 and said China should continue implementing a “moderately loose” monetary policy, according to Jiemian News. The committee said the external environment has become more complex and volatile, with weak global growth momentum, frequent geopolitical conflicts and trade frictions, divergent performance among major economies, and uncertainty around inflation trends and monetary policy adjustments. It said China’s economy has been generally stable but still faces challenges including strong supply and weak demand, structural divergence, and external shocks, and called for stronger counter-cyclical and cross-cyclical adjustments, better use of monetary policy tools’ aggregate and structural functions, and closer coordination between monetary and fiscal policy to support stable growth and a reasonable rebound in prices.