China's central bank said on Wednesday it would increase policy support for the economy, which it said faced challenges from a tough external environment and weak domestic demand.
In a statement after its third-quarter monetary policy meeting on Monday, the People's Bank of China said it would implement prudent monetary policy with "precision and strength" and focus on expanding domestic demand and boosting confidence.
The People's Bank of China reiterated its commitment to maintain reasonably ample liquidity and steady credit growth. Earlier this month, China's central bank cut the reserve requirement ratio for banks in an effort to release more liquidity into the financial system.
The central bank also said it would guide banks to lower the cost of corporate financing and credit for households, while supporting banks to replenish capital. China's central bank said it will effectively stimulate private investment, while helping prices recover from low levels and keep prices at a reasonable level.
The central bank also reiterated that it would keep the yuan's exchange rate stable and resolutely guard against the risk of overshooting.
In order to support the sluggish real estate market, the central bank of China further said that it will accurately implement differentiated housing credit policies due to urban policy, reduce the down payment ratio and the lower limit of two sets of mortgage interest rates, and promote the reduction of the stock of first set of mortgage interest rates.