The People’s Bank of China, the equivalent of the U.S Federal Reserve or the Chinese Central bank, indicated yesterday its intentions for a reformation of the country’s financial architecture after a meeting of high-ranking communist officials who have promised sweeping reforms.
The promised reforms will cover many economic sectors from government policies on interest rates, stock market processes, like IPO regulation, and most significantly for the global FX industry – easing currency exchange restrictions.
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Meanwhile, Zhou Xiaochuan, who has served as the governor of the People’s Bank of China for over a decade now, is quoted in a new book as vowing to quicken the process of full yuan convertibility, allowing free movement of capital in and out of China, and letting the Chinese currency exchange rate float. This being in constant demand from many international bodies – chiefly among them the U.S Fed which long held China as a currency manipulator for its refusal to let the yuan appreciate against the dollar.
The book that governor Xiaochuan was quoted from is a recently released 300-page guidebook of reforms, containing the full text of the Chinese Communist Party’s plans for economic reforms. President of China and General Secretary of the Chinese Communist Party, Xi Jinping, is among the other high-ranking officials whose writing features in the guidebook.
Some examples of other important quotes of Governor Xiaochuan from the guidebook, which shed light on the Communist leadership plans for FX reforms are: “We will widen the floating range of the Yuan exchange rate in an orderly manner and increase the two-way flexibility of the currency,” and “We must seize the favorable time window to quicken the pace of realizing Yuan convertibility in capital account.”