'No risk of deflation, loans to top 5b yuan in 2009'

China's financial institutions are set to issue more than 5 trillion yuan in new loans and the country will not face any risk of deflation this year, a top central bank official said yesterday.

"The total lending this year will definitely exceed 5 trillion yuan," said Su Ning, deputy central bank governor, during the annual sessions of the parliamentary meeting and the advisory body meeting.

"The central bank could resort to adjustment of banks' reserves requirement, open market operations, interest rates and other instruments to increase the liquidity in the markets if it is under strain," Su said, without elaborating.