At the recently concluded Fourth Plenary Session of the 20th CPC Central Committee, it was proposed to establish a scientifically sound monetary policy system and a comprehensive macroprudential management framework.

On the afternoon of October 27, the 2025 Financial Street Forum Annual Meeting, themed "Global Financial Development Under Innovation, Transformation, and Reshaping," opened in Beijing. During the event, People's Bank of China (PBOC) Governor Pan Gongsheng delivered a keynote speech titled "The Construction Practice and Future Evolution of China's Macroprudential Management System."

Pan acknowledged that while monetary policy is a traditional and well-defined mandate for central banks, macroprudential management remains in its early stages globally, with ongoing exploration and refinement. To build a comprehensive macroprudential framework, the PBOC will focus on four key areas: 1. Strengthening the linkage between macroeconomic performance and financial risks. 2. Enhancing oversight of financial market operations. 3. Expanding coverage of systemically important financial institutions. 4. Addressing spillover effects from international economic and financial market risks.

One critical aspect of improving the macroprudential framework involves reinforcing additional regulatory requirements for systemically important financial institutions. Pan revealed that the PBOC will conduct comprehensive assessments to identify such banks, insurers, and financial infrastructures, applying tailored regulatory measures based on their systemic significance.

Pan emphasized the need to accelerate the development of a holistic macroprudential system, including stricter oversight of systemically important banks through countercyclical capital buffers and recovery/resolution plans. A list of systemically important insurers will also be released to implement additional regulations.

During the forum, Pan announced several major policy moves, such as resuming open-market government bond transactions, optimizing the digital yuan management system, and exploring measures to support personal credit rehabilitation. He also addressed stablecoins, reiterating that PBOC’s 2017 policies against domestic virtual currency speculation remain in effect. The central bank will continue cracking down on such activities while monitoring overseas stablecoin developments.

**Macroprudential Assessment (MPA) to Be Split** Pan explained that the macroprudential system serves as an institutional arrangement to mitigate systemic financial risks. Going forward, the PBOC will enhance its monitoring and evaluation mechanisms.

On monitoring, the national financial database will improve dynamic surveillance of key risk areas, while interbank market transaction repositories will aggregate high-frequency trading data. For evaluation, the MPA—introduced in 2016—will be divided into two components: one assessing monetary policy implementation and the other focusing on macroprudential and financial stability evaluations.

Pan noted that a preliminary MPA restructuring plan is ready and will be refined after consultations with financial institutions. Analysts suggest the revised MPA will better serve monetary policy transmission, guiding credit allocation to critical sectors.

**PBOC to Resume Government Bond Trading** After a suspension earlier this year due to bond market imbalances, the PBOC will restart open-market government bond transactions. Pan highlighted that these operations, initiated last year, help enrich monetary policy tools, enhance treasury market functions, and improve coordination between monetary and fiscal policies.

Experts interpret the resumption as a response to increased government bond issuance and a measure to stabilize interest rates. Ming Ming, Chief Economist at CITIC Securities, noted that the move supports fiscal stimulus while ensuring smooth monetary policy transmission. Zhang Lin, Deputy Director of Far East Credit Ratings Research Institute, added that the decision reflects improved bond market conditions and aims to optimize liquidity management.

**Digital Yuan Management Upgrades** Following the announcement of a digital yuan international operations center at the 2025 Lujiazui Forum, Pan disclosed plans to establish a Beijing-based management center for system development and maintenance. The PBOC will also refine the digital yuan’s monetary hierarchy and expand participation among commercial banks.

At a recent conference, Mu Changchun, Director of the PBOC’s Digital Currency Research Institute, suggested upgrading the digital yuan’s accounting framework to align supply with economic growth while incentivizing user adoption.

The PBOC will continue strengthening coordination between monetary policy, macroprudential management, and regulatory oversight, alongside advancing legislative reforms to bolster financial stability.