-- On September 10, the State Council Information Office held a press conference on implementing the 15th Five-Year Plan in the financial sector and advancing China’s development as a financial powerhouse. Lu Lei, deputy governor of the People’s Bank of China (PBOC); Cong Lin, vice minister of the National Financial Regulatory Administration (NFRA); Li Chao, vice chairman of the China Securities Regulatory Commission (CSRC); and Li Bin, deputy administrator and spokesperson of the State Administration of Foreign Exchange (SAFE), outlined the relevant measures and answered questions from the media. Huafu Securities has promptly produced interpretations of the key policy highlights from this press conference.
I. Monetary policy shifts from quantity targets to interest rates
People’s Bank of China (PBOC) Deputy Governor Lu Lei said the central bank had issued a reform and development plan with nine supporting action plans. It will improve its monetary policy and macroprudential frameworks, coordinating countercyclical adjustments with policy management across economic cycles. Growth in aggregate financing to the real economy and money supply will remain consistent with targets for economic growth and the overall price level. The central bank will continue refining a modern monetary policy framework with Chinese characteristics, maintaining the stability of the currency’s value and thereby promoting economic growth and high-quality development in the real economy.
The PBOC will gradually reduce its emphasis on quantity-based intermediate targets and rely more on interest rates. It will improve base money provision and the reserve requirement system, conduct more flexible and precise open market operations, and strengthen market-based interest rate formation and policy transmission. These measures should help short-term money market rates move more smoothly around the policy rate. The central bank will also give markets a decisive role in exchange rate formation, allowing greater renminbi flexibility while maintaining broad stability at an adaptive and balanced level.
Huafu Securities views this as a systematic upgrade of monetary policy and expects stronger transmission to carry policy signals to the real economy more efficiently, making the pricing of rate-sensitive assets, including bonds and growth stocks, more market-driven. Greater precision and adaptability will help smooth economic fluctuations while supporting stable growth, prices and exchange rates. Currency stability will remain the anchor for high-quality development.
II. Eight priorities for capital market reform
China Securities Regulatory Commission (CSRC) Vice Chairman Li Chao said a new round of reform and opening-up would advance capital market development. By 2030, the market’s 40th anniversary, China aims to have broadly established a new pattern of high-quality development, with substantially greater overall strength and international competitiveness.
The agenda has eight priorities: making capital market rules and institutions more inclusive and adaptable; strengthening the market’s inherent stability; strengthening regulation and investor protection; improving the multi-tiered capital market system; raising the quality and investment value of listed companies; accelerating the development of world-class investment banks and investment institutions; building safer and more efficient financial infrastructure; and expanding high-level opening-up.
Li emphasized the complementary roles of investment and financing. Reforms to the STAR Market, ChiNext and follow-on financing are improving fundraising efficiency. The average IPO review period on the Shanghai and Shenzhen exchanges has fallen to just over six months, while some high-quality companies’ follow-on financing applications have been reviewed in less than one month.
The CSRC will make issuance, listing, merger and restructuring rules more inclusive, adjust listing standards and extend access to innovative businesses. It will revise follow-on financing registration rules, coordinate development of the Beijing Stock Exchange and the National Equities Exchange and Quotations, and improve private equity and venture capital arrangements from fundraising through exit. The aim is to encourage early-stage investment in small firms, long-term commitments, and investment in hard technology. These changes are intended to make the A-share market the preferred listing venue for high-quality domestic companies and improve the full investment cycle for private capital.
According to Huafu Securities, these reforms provide a clear medium- to long-term development framework and expects better financing arrangements, stronger investor protection, and more efficient capital allocation to support technological innovation and new quality productive forces. The reforms will strengthen the A-share market’s appeal to high-quality companies while shifting the emphasis from expansion in size toward improvements in quality, stability and international integration.
III. Four goals for foreign exchange administration
State Administration of Foreign Exchange (SAFE) Deputy Administrator Li Bin outlined a framework that is more convenient, more open, more secure and more intelligent. SAFE will reform banks’ foreign exchange operations and improve facilitation measures for businesses with sound compliance and integrity records. Capital account opening will advance alongside renminbi internationalization, with greater emphasis on institutional opening-up, convenience for businesses as a whole, and coordinated management of domestic and foreign currencies. The shift is from opening individual channels to improving the underlying institutions, and from simplifying individual transactions to making operations easier for businesses overall.
For direct investment, SAFE will facilitate cross-border transactions in response to business needs. For cross-border financing, it will improve technology companies’ access to overseas funding and expand pilot facilitation policies for green external debt. For securities investment, it will align market access more closely with international practice, integrate channels and harmonize rules to support both inward and outward investment.
Huafu Securities holds this represents a shift from transaction-level oversight toward enabling businesses and improving institutional coordination, and expects capital account opening to proceed steadily through differentiated measures, with particular support for technology and green industries. The reform package balances greater openness with effective risk control, creating a stronger institutional basis for orderly cross-border capital flows and international economic activity.
Summary and Outlook
Huafu Securities believes the three reform agendas are mutually reinforcing. More effective monetary policy transmission, deeper capital markets and more convenient cross-border finance should improve the financial system’s capacity to serve the real economy. These measures will provide institutionalized financial safeguards for high‑quality financial development and stable macroeconomic performance during the 15th Five‑Year Plan period.
Contact Info:
Name: Zhiqiang Ren
Email: Send Email
Organization: Huafu Securities Co., Ltd
Phone: (+86) 13482261143
Website: https://www.hfzq.com.cn/
Release ID: 89203458
Google
RSS