PBOC Mulls New Tool for Regulating Money Supply, Guiding Rates

(Beijing) – The central bank has been mulling a new tool to regulate money supply and guide medium-term interest rates, a source with knowledge of the matter says.

An official in charge of designing the instrument disclosed the plan in a recent internal conference, a central banker who attended the meeting said.

The tool will be called Pledged Supplementary Lending, he said. The bank wants it to be a new channel for injecting liquidity into the market and hopes it can play the role of benchmark interest rate in the medium term.