BEIJING -- The People`s Bank of China (PBOC) on Thursday announced it might use a variety of measures, including bank and treasury bond issues and reserve ratio requirements, to control the country`s "severe" liquidity problem.

A PBOC report gave no details about the extent of the measures or when or how they would be implemented, but it stressed that absorbing liquidity in banks and strengthening credit control could not fundamentally tackle the constant and rapid accumulation of liquidity and other structural problems.

"These measures can only create a steady monetary and financial environment for China`s economic growth and win time for restructuring and reform," said the central bank`s Third Quarter Report of the Implementation of the Monetary Policies.

Excessive growth in investment, the trade surplus and credit remained the prominent problems of the Chinese economy.

"China still faces severe situations on liquidity.... The role of price levers will be strengthened while the use of interest rates and exchange rates policies will be more coordinated so as to stabilize inflation anticipation," it said.

The report identified the immediate reason for excess domestic liquidity as the continuous surplus of international payments, but also pointed to deep-seated structural problems, such as the high saving ratio accompanied by low consumption.

The report also revealed that bank savings are shifting from term accounts to current accounts, although the saving inclination among local residents picked up slightly after interest rate hikes, interest tax cuts and rising risks on the capital market.

PBOC figures show the third quarter aggregate deposits on individual accounts were 213 billion yuan (US$28.55 billion) less than the second quarter.

In the first nine months, the balance of deposits in Renminbi rose 6.9 percent over the same period of last year to 17.2 trillion yuan (US$2.3 trillion). The growth was 9.2 percentage points lower than the same period of last year. Both current and demand accounts have seen less increase in deposits from a year earlier.

The total balance of deposits in Renminbi and other currencies by all financial institutions amounted to 39.5 trillion yuan (US$5.29 trillion), up 16 percent over the same period of last year. The rise was 0.4 of a percentage point lower than the same period of last year.