(Yicai Global) July 5 -- People's Bank of China said yesterday on its official website that its monetary policy commission recently convened the regular session for the second quarter in Beijing. The meeting stressed the need to closely watch the dynamics of international capital flows and trends in economic and financial operations at home and abroad.

China should encourage progress while keeping performance stable, adapt to the new economic normal, fully implement a prudent and neutral monetary policy and apply monetary policy tools in a bid to maintain stable liquidity and reasonably increase the scale of credit and social financing, the commission said.

The country's economy and financial systems are, by and large, developing at a steady and sound pace amid complicated situations, participants at the meeting said.

The global economy is in a profound adjustment phase in the aftermath of the global financial crisis, and as the world's economy picks up, major developed countries are recovering and some emerging economies are still facing challenges, they said. The international financial market remains vulnerable to risk.

China's financing and credit structure should be optimized to further supply-side structural reform, participants said. Reforms in the financial sector should be advanced to rev up operational efficiency and serve the real economy while improving risk management, they said. China should promote interest rate liberalization and yuan exchange rate reforms to keep exchange rates stable, they said.