(Yicai Global) Oct. 21 -- China's central bank will stick to the financial industry's main goal of serving the real economy under the guideline of the report released by the ongoing National Congress of the Communist Party of China, according to a vice governor.

The People's Bank of China will continue to implement prudent monetary policies and keep the Chinese yuan's exchange rate basically stable at a reasonable level, Pan Gongsheng said at a press conference yesterday.

Next, the PBOC will prioritize the adjustment function of the economic cycle so as to create a good environment for promoting economic growth, expanding employment, stabilizing good prices, and maintaining a balance of payments, Pan said. It will also guide financial resources toward key areas and weak links of economic and social development.

The central bank will continue to open the domestic financial sector wider to the world, further advance market-oriented reforms of the yuan's exchange rate while making great efforts to develop inclusive and green finance as well as fintech to shore up the healthy and stable development of the capital market, he added.

The redback has deprecated modestly against the US dollar and there is no foundation for long-term devaluation as the sustained strengthening of the greenback this year has put other currencies under larger devaluation pressures, Shao Yu, chief economist at Orient Securities, told Yicai Global. Economic recovery and the expected introduction of more supportive policies will further support the redback, he added.

Last month, the PBOC lowered the foreign exchange reserve requirement ratio for financial institutions and raised the forex risk reserve ratio for currency forward sales, Guo Lei, chief economist at GF Securities, told Yicai Global. These are all clear signs of the central bank's intention to stabilize the forex market, Guo said, adding the PBOC still has many policy tools up its sleeve.

The prudent monetary policies implemented by the PBOC in recent years have promoted high-quality economic development and effectively supported poverty eradication, scientific and technological innovation, green transformation, rural revitalization, and manufacturing industry upgrades, Pan added.

Editor: Emmi Laine, Xiao Yi