China will continue to pursue a prudent monetary policy in the coming months, aiming to keep the yuan exchange rate stable at a reasonable and balanced level, said the central bank on Monday.

China would further improve its monetary policy, making it more scientific and more effective in preserving the stability of the RMB, according to a meeting of the monetary policy commission of the People's Bank of China.

The monetary policy commission usually convenes at the end of each quarter to discuss the macro-economic situation and make suggestions about monetary policy for the coming months.

In the first few months of next year, China should restrict loan growth to a reasonable pace and optimize loan structure, said the commission.

Besides stabilizing RMB prices, the monetary policy also aims to expand domestic consumption, prevent investment from growing too fast, and promote an international payment balance, said the commission.

(Xinhua News Agency December 26, 2006)