YI GANG, THE head of China's central bank, is fond of saying that he wants to run "normal" monetary policy. By that he means keeping interest rates well above zero, ensuring that the yield curve slopes upwards and avoiding direct purchases of the government's bonds-much of which, in fact, make the People's Bank of China (pboc) a highly abnormal central bank these days. The clearest sign of this is its balance-sheet. In terms of its assets, the pboc has gone from the undisputed heavyweight to a middleweight. Its restraint is a combination of two different strands in its pursuit of policy normality: an avoidance of the unusual manoeuvres that have become common elsewhere and a reversal of some of the unusual manoeuvres that used to be common in China.
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