On October 9, the People’s Bank of China (PBOC) made a notable announcement on its website regarding the formation of a joint working group with the Ministry of Finance. This initiative is designed to implement directives from the 20th Central Committee’s third plenary session and to address requirements from the recent central financial work meeting, specifically aiming to enhance the monetary policy toolkit. A significant focus of their discussions included plans for gradually increasing trading of government bonds within the central bank’s open market operations.
The inaugural meeting of this working group brought together key figures, including Xuan Changneng, Vice Governor and member of the PBOC’s Party Committee, and Liao Min, Vice Minister and member of the Ministry of Finance’s Party Group. During the session, both leaders commended their prior collaboration in central bank government bond trading. They laid out the operational framework for the working group and shared insights on the current state of the bond market.
Both the PBOC and the Ministry of Finance recognized that trading government bonds serves as a vital instrument for enriching the monetary policy toolkit and enhancing liquidity management. Moving forward, they stressed the importance of balancing development and security, fostering policy collaboration, and continually optimizing relevant institutional frameworks. This strategy aims to ensure the stable development of the bond market while creating a conducive environment for central bank government bond trading. Participants from relevant departments of both institutions were actively involved in the discussions.
