China's central bank, the People's Bank of China, has decided to continue with a moderately easy monetary policy in 2009. The central bank has also repeated the goal of delivering 17 percent growth in the broad money supply as part of its campaign to ensure that companies have enough credit in the face of a slowing economy. Experts say these decisions will help boost the country's teetering stock market and real estate market. Our reporter Wang Ling has more.

Reporter:
The Chinese central bank has set the target of the increase of broad money supply

to 17% in 2009, 2.2% higher than that of last November.

Zhao Xijun, a finance professor from the Renmin University of China, says this policy aims to maintain sufficient fund supply.

"The goal of a loose monetary policy is to provide a sound financial condition for investors and consumers, there helping maintain a stable and rapid economic growth."

The central bank also said it will use interest rate, bank reserve requirements and open-market tools to realize a flexible fund supply.

Last year saw a worsening stock market in China with the bubble bursting. The composite index of the Shanghai stock market shed 65% through the year and 20 trillion yuan got evaporated in the market. China's real estate market also suffered a recession with a decline in sales in cities such as Beijing and Shanghai.

Professor Zhao Xijun says the policy decisions by the central bank will help stabilize China's stock market and real estate market.

"A loose monetary policy and market liquidity can provide more resources to the capital market. At the same time, low interest rate will reduce the cost of financing and enlarge profit margins, which will help improve the performance of the listed companies and thus prop up growth of the capital market. As for the real estate industry, this will also cut costs and thereby the housing price. For buyers, low interest rate also means saving money. The real estate market will benefit either way."

Professor Zhao Xijun says while the monetary policy means to boost the stock market and real estate industry, it demands more supporting polices from related departments to reverse the downturn.

Senior researcher Ba Shusong supposes collaboration of monetary policy and fiscal policy is an efficient way for China to fend off the global financial crisis as it brings about a looming impact on the economy.

"It requires fiscal policy working together with monetary policy to boost investment and consumption. With institutional reform, the collective effort can truly boost the country's economy. It will be the focus and challenge in the coming years."

Wang Ling, CRI news.