China central bank reform plan targets high-level financial opening-up

The People's Bank of China (PBOC), China's central bank, has issued a reform and development plan for the 2026-2030 period, making work arrangements aimed at accelerating the building of a nation with a strong financial sector and improving the central banking system.

The plan said measures will be taken to "prudently advance high-level financial opening-up," noting efforts will be made to expand the global use of the renminbi in international trade, investment and financing, deepen two-way financial market access, quicken steps to build Shanghai into an international financial center and enhance the role of Hong Kong as a global financial center.

As part of the opening-up drive, the PBOC will enhance the multi-tiered and broad-coverage Cross-Border Interbank Payment System (CIPS) and push forward the development of offshore renminbi markets.

On the domestic monetary policy front, the plan sets out to build a more scientific and robust framework by refining the modern monetary policy system with Chinese characteristics, improving the base-money issuance mechanism, and making better use of both aggregate and structural tools.

It stresses the need to enhance market-based interest rate formation, transmission, and adjustment mechanisms, while allowing the market to play a decisive role in exchange-rate determination and keeping the renminbi broadly stable at a reasonable and equilibrium level.

To fortify financial stability, the central bank will expand the coverage of macro-prudential management, enrich its policy toolkit, and establish a monitoring and evaluation system to mitigate systemic risks in key areas.

A major pillar of the plan is to strengthen the real economy's access to quality financial services. The PBOC has pledged to build a precise and effective policy system to support major strategies, key sectors, and address weak links. This includes developing a financial system tailored to scientific and technological innovation. It also aims to enhance green and low-carbon financing, expand inclusive finance, improve the pension finance system and accelerate digital finance.

Looking ahead to the 2026-2030 period, the PBOC says it will ensure all measures in the plan are executed effectively to boost China's strength in finance and support high-quality economic development.

The People's Bank of China (PBOC), the country's central bank, announced on Monday that it has decided to authorize Deutsche Bank to serve as the RMB clearing bank in Frankfurt, Germany.

The decision was made in accordance with a memorandum of understanding between the PBOC and the Deutsche Bank, the central bank said.

Deutsche Bank said it will facilitate direct end-to-end processing, clearing and settlement services for cross-border renminbi transactions for European financial institutions and businesses.

The bank said the move streamlines cross-border trade and investment flows, and strengthens financial connectivity between China and Europe.