China signals moderately loose policy, capital market reform

As the opening year of the 15th Five-Year Plan period approaches its final stretch, China's financial regulators are sending signals on stabilizing growth and expectations. On Friday, the People's Bank of China (PBOC) and the China Securities Regulatory Commission (CSRC) laid out their respective priorities for monetary policy and capital market work.

The PBOC said it will continue to implement a moderately loose monetary policy and use a range of policy tools to maintain ample liquidity. It will advance the development of the five key areas of finance — technology finance, green finance, inclusive finance, pension finance and digital finance — and accelerate the development of a modern, multi-tiered financial market system.

The central bank also pledged to improve financial services to better meet the needs of the real economy, support economic transformation and upgrading, and facilitate the shift to new growth drivers. It will take effective measures to prevent and defuse financial risks in key areas, further open up the financial sector, promote RMB internationalization, and expand access to cross-border RMB payment systems. It also reaffirmed its commitment to safeguarding national financial security.

The CSRC said it will step up efforts to stabilize the capital market and market expectations, deepen comprehensive reforms in investment and financing, and improve the regulatory framework across the entire market. It will also work to strengthen market resilience and confidence, ensuring the successful implementation of capital market priorities in the opening year of the 15th Five-Year Plan.

(Cover via CFP)