The People's Bank of China released its monetary policy implementation report for the second quarter of 2026 on August 12, as reported by financial sources. The report emphasizes the commitment to maintaining a moderately accommodative monetary policy framework.

It highlights the need to enhance the policy's forward-looking, flexible, and targeted nature. The pace, intensity, and timing of policy implementation should be calibrated based on domestic and international economic and financial conditions, as well as financial market operations. Closer coordination with fiscal policy is also required to support stable economic growth, high-quality development, and the smooth functioning of financial markets.

A comprehensive and dynamic approach will be taken in utilizing monetary policy tools. The aim is to keep liquidity ample and social financing conditions relatively loose, guiding the growth of aggregate social financing and the money supply to align with the targets for economic growth and the general price level. The reform and improvement of the monetary policy operational framework will be advanced steadily and orderly, ensuring that short-term money market rates move smoothly around the policy rate.

The role of the market interest rate pricing self-regulatory mechanism will be leveraged. Supervision and enforcement of interest rate policies will be strengthened, and the diversification of loan pricing benchmarks will be promoted. Financial institutions will be guided to enhance their capacity for interest rate pricing. Efforts to make the comprehensive financing costs for enterprises more transparent will be deepened, intermediation fees in financing will be reduced, and the overall social financing cost will be kept at a low level.

The dual functions of monetary policy tools in terms of aggregate and structure will be fully utilized. A series of monetary and financial policies introduced at the beginning of the year will be implemented effectively. Tool design and management will be continuously improved, and the "five major articles" in finance will be executed with dedication. Financial support for key areas such as expanding domestic demand, technological innovation, and small and micro enterprises will be strengthened.

The central bank reiterated its commitment to a managed floating exchange rate system, which is based on market supply and demand and adjusted with reference to a basket of currencies. It will maintain exchange rate flexibility and leverage the exchange rate's role as an automatic stabilizer for the macroeconomy and balance of payments. A comprehensive set of measures will be employed to enhance the resilience of the foreign exchange market, stabilize market expectations, and prevent risks of exchange rate overshooting. The goal is to keep the renminbi exchange rate generally stable at a reasonable and balanced level.

Finally, the central bank's macro-prudential and financial stability functions will be expanded and enriched. Innovative financial tools will be developed to maintain the stable operation of financial markets, and all efforts will be made to guard against the systemic financial risks.