China already in phase of stabilizing leverage ratio: central bank

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The government work report released on Monday did not specify a growth target for M2, a broad measure of money supply, giving concerns to tightening liquidity conditions.

Liquidity conditions might not necessarily become tight as China improves utilization efficiency of broad money supply, he added.

He pointed out that China's monetary supply regulation will be determined more by economic indicators like inflation level and employment.

BEIJING, March 9 (Xinhua) -- China has entered a stage of stabilizing leverage ratio and is gradually reducing it, China's central bank governor said Friday.

China is likely to reduce reliance on wide capital support for economic growth as the country seeks high-quality development, Zhou Xiaochuan, head of the People's Bank of China, told a press conference on the sidelines of the first session of the 13th National People's Congress.

The M2 is not a very precise tool to gauge whether the monetary policy is tight or loose given the constantly changing structure of financial market and products, Zhou said.

The country's debt-to-GDP ratio has decreased to 36.2 percent by the end of 2017 from 36.7 percent in 2016, far below the international alert line of 400 percent, according to the Ministry of Finance.