MIL-OSI China: PBOC and MOF Joint Working Group Holds its First Official Meeting

In order to implement the guidelines of the Third Plenary Session of the 20th CPC Central Committee, as well as the requirement put forward at the Central Financial Work Conference to enrich the toolbox of monetary policy by gradually increasing the purchase and sale of government bonds in the central bank’s open market operations, the People’s Bank of China (PBOC) and the Ministry of Finance (MOF) have established a joint working group. Its first official meeting was held recently. Xuan Changneng, Deputy governor of the PBOC and Liao Min, Vice Minister of Finance attended and addressed the meeting. At the meeting, both sides highly recognized their previous close cooperation in buying and selling government bonds by the central bank. They also established the mechanism for the operation of the working group, and exchanged opinions on issues such as the operation of the bond market. Both agreed that the central bank’s buying and selling of government bonds is an important means to enrich the monetary toolbox and strengthen the liquidity management. Moving forward, both sides should strike a balance between development and security, and keep on promoting policy coordination. They should continuously improve relevant institutional arrangements, regulate the bond market and maintain its stable development, so as to provide a favourable market environment for the central bank to buy and sell government bonds. Officials from relevant departments of the PBOC and the MOF also attended the meeting.