supplementary mortgage loans (PSL, Pledged Supplementary, PSL Lending) as a new reserve policy tool, has two meanings, first level, is the new channel of base money; secondly, the price level, through commercial bank mortgage assets to obtain financing from the central bank's interest rate, guide the medium-term interest rates.
    supplementary mortgage loans (PSL, Pledged Supplementary, PSL Lending) as a new reserve policy tool, has two meanings, first level, is the new channel of base money; secondly, the price level, through commercial bank mortgage assets to obtain financing from the central bank's interest rate, guide the medium-term interest rates.
 
To explore the new tools of monetary policy background, increase foreign exchange volatility and slowdown since the second half of 2012, the influence of base money pattern, central bank liquidity management has gradually from the past more than ten years of passive hedge foreign exchange inflows to active management change, the monetary policy framework also needs to gradually change from quantity to price.
 
After the financial crisis in 2008, with the United States, Europe, Japan, the United Kingdom as the representative of the major developed economies, a large number of central banks to put on the basis of monetary innovation. This is the monetary base of the central bank China innovation played a very good role in Pathfinder, Chinese central bank will be a new tool for the creation of will join the camp of — — mortgage Supplemental Loan (PSL).
 
PSL's goal is to use PSL's interest rate to guide the medium-term policy rate, in order to achieve the central bank in the short-term interest rate control, the long-term interest rates in the guidance and control. Since the end of 2013, the central bank on short-term interest rates through the SLF (standing lending facilities) has been constructed interest rate corridor mechanism.
 
PSL this tool and is very similar to refinancing, refinancing is an unsecured credit loans, but the market is often a loan given some financial stability means that a mechanism will be put out of the question of refinancing. For various reasons, the central bank may be to upgrade the loan tool for PSL, the future of PSL is likely to replace the loan facility to a large extent, but again the loan is still in the central bank's policy instruments basket.
 
In our country, there are a lot of credit delivery, such as infrastructure, livelihood expenses like credit, often with government guarantees a certain degree but poor profitability, if market interest rates of commercial banks, completely independent pricing pricing based on the credit business, the higher prices will not meet the demand for credit. PSL called the central bank to guide the medium-term policy interest rates, to a large extent is to provide a direct part of the Commercial Bank of low-cost funds, to guide investment in these areas. This can also play a role in reducing the cost of this part of the social financing.
 
In mid September 2014, the market has been rumors that the central bank through the SLF to the five major banks put 500 billion yuan of liquidity. Three days later, China Construction Bank Chairman Wang Hongzhang in an interview with the Xinhua News Agency confirmed the rumors.  
 
In 2014 10, the media once again revealed that a number of joint-stock commercial banks have received notice of the central bank, the standing lending facilities tools (SLF) to obtain liquidity support, a total amount of about 200 billion yuan. In addition, market sources, the central bank's report is expected to be in the central bank liquidity may be higher than 200 billion yuan, reaching 3000-4000 billion. But this rumor has not been confirmed by the central bank and commercial banks.  
 
Gold report revealed that the central bank's approach is not previously transmitted SLF, but need to provide bank bonds pledged PSL; Friday the central bank is only informed that next week will be the actual delivery. Gold believes that the move once again released a signal of liquidity easing, especially in the case of the actual M2 growth was significantly lower than the policy objectives.