How to determine the stance of monetary policy? Expert authorities respond

“In recent years, China has further shifted towards a price-based monetary policy framework, with open market operations mainly serving interest rate regulation targets, and there is no need to pay too much attention to this in the future,” an authoritative expert told China Securities Journal on March 13. The expert stated that, based on the operation of the money market, since the beginning of this year, the overnight funding rate (DR001) has been operating at a low level, with an average of about 1.33%, which is 7 basis points lower than the central bank’s policy rate, indicating a relatively loose monetary and financial environment. The expert also mentioned that the scale of open market operations is influenced not only by the stance of monetary policy but also by seasonal factors such as fiscal revenue and expenditure, residents’ tax payments, and holiday withdrawals, so it is not appropriate to simply judge whether monetary policy has shifted based on changes in the volume of open market operations, especially a single type of operation. (China Securities Journal)