China central bank to maintain prudent monetary policy

People's Bank of China Governor Zhou Xiaochuan said Friday China's central bank will continue to implement prudent monetary policies, but will conduct preemptive adjustments and fine tuning in an appropriate way when necessary, state media reported. "The central bank will work with other departments to guide financial institutions to maintain reasonable lending level, and will use multiple tools to adjust liquidity and keep the market overall stable," Xinhua News Agency quoted Zhou as saying at a financial forum in the city of Shanghai. Earlier this week, People's Bank of China took actions to quell fears a recent money squeeze, which pushed interbank money rates to historic high, could expand into a full-blown financial crisis and hurt real economy, the report said. But still, the central bank of the world's second-biggest economy has made it clear and reiterated that there is reasonable level of liquidity and lenders should improve money management and lending practices, it added.