China's central bank said on Monday that it would "flexibly" use various policy tools to maintain appropriate liquidity and reasonable growth in credit and social financing.
The People's Bank of China (PBC), the central bank, will keep the yuan basically stable while forging ahead with reforms to help improve its currency regime, it said in a statement summarizing the fourth-quarter monetary policy committee meeting.
The PBC said it would maintain a prudent monetary policy, keeping its stance "neither too tight nor too loose." The prudent policy has been in place since 2011.
The central bank said it would closely watch changes in China's economy and financial markets, as well as international capital flows.
Top leaders at the annual Central Economic Work Conference, held on December 18-21, pledged to make monetary policy more flexible and expand its budget deficit in 2016 to support a slowing economy.