WASHINGTON, April 10 The Chinese government and
central bank should be "very cautious" in implementing any
stimulus programs because they tend to be less efficient than
natural market forces in boosting growth, a People's Bank of
China official said on Thursday.
Yi Gang, a vice governor of the bank, also told a conference
in Washington, ahead of the spring meetings of the International
Monetary Fund and World Bank, that Chinese economic growth of "a
little bit more, a little bit less" than 7.5 percent was
acceptable. Last year, China's economy expanded by 7.7 percent.
"Any kind of stimulus package should be very cautious in the
sense that you should believe that the market driver is the
natural and the most efficient way to grow, and a stimulus
growth driver is not as efficient as the natural market driver,"
"And the government and the central bank should be very
Beijing has been at pains to play down market speculation
that it might launch a large stimulus package to support a
slowing economy, saying instead that it would fine-tune policies
to ensure unemployment did not rise.
Chinese Premier Li Keqiang on Thursday ruled out major
stimulus even as big falls in imports and exports added to
concerns about a slowdown.
Li stressed that job creation was the government's policy
priority, and it did not matter if growth came in a little below
the official target of 7.5 percent.
His comments were among the clearest yet on the government's
plans for the economy, which has rattled global investors this
year with a surprisingly lacklustre performance.
Trade data on Thursday showed exports unexpectedly fell for
the second consecutive month in March, the worst showing in more
than four years, while imports fell by the most in 13 months.
Speaking in Washington, Yi of the People's Bank of China
(PBOC) said two-way fluctuations in China's yuan were
"normal". U.S. officials have voiced concern about the yuan's
recent weakening against the dollar.
Last month, the PBOC loosened its grip on the yuan by
doubling its daily trading band, adding teeth to a promise it
would allow market forces to play a greater role in the economy.
"In the first quarter of this year, we had several things
happen," Yi said. "The U.S. Federal Reserve had the tapering,
and (we) have the increase for our trade deficit."
"So that I would say that the two-way fluctuation of the
renminbi would be a normal phenomenon," Yi said.
(Reporting by David Brunnstrom; Editing by Tim Ahmann, Wayne
Cole and Mark Bendeich)