Update: QE Speculation Dismissed by Source Close to Central Bank

China will strengthen targeted funding support for the economy but will shun across-the-board quantitative easing (QE) to keep its debt problems in check, a source close to the central bank told Caixin, downplaying expectations for aggressive monetary loosening sparked by remarks from a finance ministry official.

A senior official at the Ministry of Finance recently called for the use of treasury bonds as quasi money, drawing speculation that China might be planning to use large-scale bond purchases to inject liquidity into the world’s second-biggest economy as growth slows. But a source close to China’s central bank has downplayed the idea.