Are you hearing me?

The central bank (PBoC) wants to be sure markets understand its newest policies.

On Monday, PBoC Governor Pan Gongsheng published a column in the People’s Daily stressing the points he’s made repeatedly since the Central Financial Work Conference (CFWC) in late October, namely:

• Credit needs to be allocated more efficiently
• Private-sector property developers need more support
• The “three major projects” – creating more affordable housing, upgrading urban villages, and building dual-use (leisure and emergency relief) facilities – are keys to overhauling the property sector

Pan also signaled the PBoC won’t slash interest rates:

• “Interest rate levels that are too high or too low are not conducive to stable and sustained economic growth.”

Some context: Some economic advisors have called for sharp rate cuts to boost growth.

• But the PBoC is reluctant to slash rates too low, fearing downward pressure on the RMB and, more importantly, eroding bank profits, which banks need to replenish capital in the face of worsening asset quality.

Pan also had some harsh words for the state of the financial sector, saying:

• “Financial chaos and corruption persist.”
• “Financial supervision capabilities are weak.”
• “There are still many hidden…financial risks.”

Get smart: Policymakers may have been waiting for the Central Economic Work Conference (CEWC) – due in the next few weeks – to understand the economic agenda and policy priorities for the year ahead.

• But this year, key policies related to credit and property were set at the quinquennial CFWC – Pan is hammering this message home, and telling officials to get to work.