PBOC to adjust liquidity when needed

China’s economic growth facing massive downward pressures.

Zhou Xiaochuan, Governor of the People’s Bank of China, the central bank said the big downward pressures means that China will increase financial incentives to support small firms. This comes after the central bank reaffirmed over the weekend its commitment to keep credit growth steady.

PBOC said both price and quantitative policy tools will be used to guide an appropriate growth in liquidity.

These statements came after liquidity concerns last month saw short term borrowing costs spike to nearly 30% on June 20. These rates have since eased to their normal 3% to 4% range.