In 2025, the final year of the 14th Five-Year Plan, China's national economy maintained stable and progressive development, successfully achieving major socioeconomic targets. The annual gross domestic product (GDP) grew by 5% year-on-year. On February 10, the central bank released its fourth-quarter monetary policy implementation report for 2025, highlighting its firm implementation of moderately accommodative monetary policies. In addition to managing existing policies effectively, the central bank introduced a package of monetary and financial measures to strengthen countercyclical adjustments, effectively supporting stable growth in the real economy and the smooth operation of financial markets.
Throughout 2025, the central bank adopted multiple measures to implement a moderately accommodative monetary policy. It utilized various tools, including reserve requirement ratios and open market operations, to maintain ample liquidity. Financial institutions were guided to enhance project reserves and credit allocation, fully meeting the effective credit demands of the real economy. Efforts were also made to lower overall financing costs across the economy by reducing policy rates, structural monetary policy tool rates, and individual housing provident fund loan rates, providing strong support for reducing comprehensive financing expenses.
Additionally, the central bank increased support for major national strategies, key sectors, and vulnerable areas. It enriched the system of structural monetary policy tools and optimized credit structures to advance the "Five Key Financial Tasks." Specific measures included increasing relending quotas for technological innovation and technological upgrades by 300 billion yuan each, establishing a 500 billion yuan relending facility for consumer services and elderly care, and creating a 200 billion yuan risk-sharing tool for sci-tech innovation bonds.
From the perspectives of financial aggregates, pricing, and structure, the effects of the moderately accommodative monetary policy in 2025 have gradually become apparent. Financial aggregates maintained rapid growth, with the outstanding social financing stock and broad money supply (M2) increasing by 8.3% and 8.5% year-on-year, respectively, by year-end—significantly higher than nominal GDP growth. After adjusting for the impact of local government debt resolution, renminbi loans grew by approximately 7%, indicating sustained strong credit support.
Overall financing costs continued to trend lower, with newly issued corporate loan rates and individual housing loan rates both around 3.1% in December 2025. Credit structure also improved steadily, with loans to technology, green sectors, inclusive finance, elderly care industries, and the digital economy growing by 11.5%, 20.2%, 10.9%, 50.5%, and 14.1% year-on-year, respectively, by the end of 2025. Loans to key sectors maintained double-digit growth, consistently outpacing the growth rate of total loans.
Notably, the renminbi exchange rate remained broadly stable amid complex conditions. At the end of 2025, the renminbi to U.S. dollar exchange rate closed at 6.9890, appreciating by 4.4% compared to the end of 2024. The CFETS renminbi exchange rate index stood at 97.99, depreciating by 3.4% from the end of the previous year.
While China's economy continues to operate steadily with progressive trends and new achievements in high-quality development, challenges such as strong supply and weak demand persist. The central bank stated that in the next phase, it will continue to implement a moderately accommodative monetary policy. Promoting stable economic growth and a reasonable rebound in prices will remain key considerations. The central bank will adjust the intensity, pace, and timing of policy implementation based on domestic and international economic and financial conditions, as well as market performance. It will flexibly and efficiently employ various policy tools, including reserve requirement ratio cuts and interest rate reductions, to maintain ample liquidity and relatively loose financing conditions, guiding reasonable growth in financial aggregates and balanced credit distribution to align social financing and money supply growth with economic expansion and price level targets.
Furthermore, the central bank will refine the interest rate regulation framework, strengthen the guiding role of policy rates, improve market-based interest rate formation and transmission mechanisms, and enhance the effectiveness of market interest rate self-discipline mechanisms. It will also intensify the implementation and supervision of interest rate policies, reduce banks' liability costs, and promote low overall financing costs across the economy.
The central bank will expand the coverage of transparent corporate loan financing cost disclosures in an orderly manner. It will leverage the dual functions of monetary policy tools in managing aggregate and structural aspects, effectively implement various structural monetary policy instruments, and advance the "Five Key Financial Tasks" to strengthen financial support for domestic demand expansion, technological innovation, small and medium-sized enterprises, and other critical areas.
Adhering to a managed floating exchange rate regime based on market supply and demand with reference to a basket of currencies, the central bank will maintain exchange rate flexibility, allowing it to function as an automatic stabilizer for macroeconomic and international balance adjustments. It will strengthen expectation guidance, prevent risks of exchange rate overshooting, and keep the renminbi exchange rate broadly stable at an adaptive and balanced level.
Additionally, the central bank will expand and enrich its macroprudential and financial stability functions, improving the toolkit for macroprudential management and financial stability to safeguard financial market stability and firmly prevent systemic financial risks.
Industry experts noted that the moderately accommodative monetary policy of the previous year has cumulative effects, with the impact of existing policies continuing to materialize. At the beginning of 2026, the central bank introduced a new package of monetary and financial measures to support high-quality development of the real economy. These incremental policies are expected to synergize with existing measures, further creating a favorable monetary and financial environment for stable growth in the real economy and a reasonable rebound in prices.