Recently, the regular meeting of the Monetary Policy Committee of the Central Bank for the second quarter of 2025 was held on the 23rd. The meeting suggested that the intensity of monetary policy regulation and control should be increased, and the intensity and rhythm of policy implementation should be flexibly grasped.

The meeting proposed to make good use of the swap facilities of securities, funds, and insurance companies, as well as stock repurchase and re-lending, explore normalized institutional arrangements, and maintain the stability of the capital market.

The global economic and financial environment is more complex than before

The meeting pointed out that the current global economic and financial environment is more complex and severe than before: world economic growth is sluggish, and many countries are slowing down; There are more and more trade barriers, and globalization is facing challenges; The performance of major economies is differentiated, some are raising interest rates, some are cutting interest rates, and the pace is inconsistent; The trend of inflation is uncertain, and the adjustment of monetary policy is also full of uncertainties. To put it simply: the wind and waves are strong outside, and we need to be more careful to deal with them.

The good news is that China's economy is steadily recovering, showing a positive trend: social confidence is slowly recovering; High-quality development is also steadily advancing; Everyone is more confident about the future. However, we should not be blindly optimistic, there are still some problems and challenges: insufficient domestic demand, that is, everyone's willingness to consume is not strong enough; Prices have been running at a low level for a long time, and deflationary pressure cannot be ignored; There are also some potential risks, such as real estate, local government bonds and other issues that have not been completely resolved.

So what to do?

The meeting clearly stated several key points: continue to implement a moderately loose monetary policy: continue to maintain reasonable and abundant market liquidity, so that everyone has funds available. Strengthen counter-cyclical adjustment: increase the temperature when the economy is cold, and cool down appropriately when it is hot, so as to maintain stability. Give full play to the dual function of monetary policy tools - aggregate + structure: we must not only manage the overall situation, but also accurately drip irrigate to support key areas and weak links. Strengthen the coordination of monetary and fiscal policies: The money bag and the account book work together to ensure the stability of the economy.

Stable growth + stable prices: neither let the economy slow down too much, nor let prices fly wildly, and maintain it in a reasonable range.

The regulation should be stronger and the shot should be more accurate

The meeting clearly proposed: increase the intensity of monetary policy regulation and control, and improve the forward-looking, targeted and effective. The meaning is simple: the central bank must not only "make more moves", but also "make the right moves". It is necessary to see farther, hit more accurately, and achieve more results. Just like a doctor, you can't just rely on experience, but also look at data, trends, and changes in your condition to prescribe medicine.

In the face of the complex economic and financial situation at home and abroad, the central bank emphasized that it should flexibly grasp the intensity and rhythm of policy implementation. That is to say, it is not blindly loose or tightened, but adjusted at any time according to market conditions.

In order to support economic development, the central bank also proposed: to maintain reasonable and abundant liquidity: to ensure that there is no shortage of money in the market; Guide financial institutions to increase credit supply: encourage banks and other financial institutions to lend more, especially to the real economy; Matching the scale of social financing and the growth of the money supply with economic growth and price targets: Simply put, money cannot be printed too much or too little, and must be matched by the pace of economic development and the inflation target.

The meeting also specifically mentioned the content of interest rate management: strengthening the guiding role of the central bank's policy interest rate; improve the formation and transmission mechanism of market-oriented interest rates; play the role of self-discipline mechanism, that is, let the market itself participate in pricing supervision; Strengthen the implementation and supervision of interest rate policies.

This is actually telling us that the future trend of interest rates will be more transparent, more market-oriented, and more disciplined.

Large banks should shoulder their responsibilities, and small and medium-sized banks should focus on their main business

The meeting pointed out that large banks should play the role of the main force and continue to provide strong support for the real economy; Small and medium-sized banks should focus on their main responsibilities and main businesses, do a good job in the areas they are good at, and do not be greedy for more.

In addition, in order to ensure that banks have sufficient funds to support the economy, the meeting also mentioned that banks should be supported to replenish their capital so that they have more "ammunition" to serve enterprises and individuals. To put it simply, large banks should take the lead, small banks should specialize, innovate and specialize, and everyone should work together to maintain the stable development of the financial market.

The meeting emphasized the importance of structural monetary policy tools, and proposed to do the following: strengthen support for scientific and technological innovation: encourage financial institutions to provide more financial support for science and technology enterprises; Boost consumption: Promote consumer demand through financial means to help the economy recover; Financing support in key areas: In particular, the "two heavy" (major infrastructure projects) and the "two new" (new urbanization and new infrastructure construction), which need more financial support.

Policy tools should be precise, focusing on supporting scientific and technological innovation and consumption, and promoting the development of key areas.

In order to maintain the stability of the capital market, the meeting proposed several specific measures: make good use of the swap facilities of securities, funds and insurance companies: these tools can help the market respond to fluctuations more flexibly; Stock buybacks to increase holdings and relending: Enterprises can stabilize stock prices by buying back their own shares, and the central bank will provide corresponding relending support; Explore institutional arrangements for normalization: Make these measures not just a one-time emergency measure, but a long-term effective mechanism. To put it simply: to ensure the smooth operation of the capital market through a variety of financial instruments and institutional arrangements.

The meeting specifically mentioned the support for the private economy and small and micro enterprises: continue to do a good job in financial services to support the development and growth of the private economy, give full play to the role of the financing coordination mechanism for supporting small and micro enterprises, and further open up the blocking points and stuck points of financing for small and medium-sized enterprises.

This means: private enterprises and small and micro enterprises will receive more financial support; The government and financial institutions will work together to solve the problem of financing difficulties for small and medium-sized enterprises. In a word: it is difficult for small and medium-sized enterprises to obtain financing? The government and financial institutions are looking for ways to help you out!

Regarding the real estate market, the meeting pointed out: increase the vitality of the stock of commercial housing and stock land, and reduce the waste of vacant resources; We will continue to consolidate the stability of the real estate market, improve the relevant financial system, and help build a new development model. It is necessary not only to prevent the real estate market from overheating or cooling, but also to revitalize existing resources and promote the healthy development of the industry.

Finally, the meeting also mentioned the importance of financial opening-up: earnestly promote high-level two-way financial opening-up, and improve economic and financial management capabilities and risk prevention and control capabilities under the conditions of opening-up.

This means: China's financial market will be more open and attract more foreign investment; At the same time, it will also enhance our ability to prevent external risks and ensure the safety and stability of the financial system. In a word: financial markets need to be more open, but also more stable.

What information was revealed at this meeting?

From the content of this meeting, we can extract several key points:

Clear policy support: Whether it is scientific and technological innovation, consumption promotion or real estate market, there are specific policy supports. Abundant structural opportunities: There are plenty of investment opportunities, especially in the areas of technology and innovation, small and micro enterprises, and real estate.

Stability of the capital market: The stability of the capital market will be further enhanced through a variety of tools and mechanisms. Financial openness brings opportunities: With the two-way opening of financial markets, investors will face more opportunities for internationalization