Zhou Xiaochuan: The Central Bank'S Policy Will Consider The Capital Market Reaction.

Governor of central bank

Zhou Xiaochuan believes that although monetary policy will trigger a great shock in capital markets in the early days of capital market development, we can see now that as the market gradually realizes the importance of monetary policy to the overall economic adjustment, besides the monetary policy, the international and domestic macro situation has also become an important reference for the market. Therefore, the market's judgement on the orientation of monetary policy is also improving.

"Now, it is often your policy that has not yet been released, and some of them have been absorbed in advance," Zhou Xiaochuan said.

As Zhou Xiaochuan pointed out, since policies rarely can be fully balanced, there are different degrees of dilemma in the introduction of each policy.

Zhou Xiaochuan said that there are different stakeholders in the big economies, so it is more difficult to make a few monetary policy tools meet all the needs of all the different interest groups.

For example, exporters may complain about rising exchange rates, but they are good for importers.

In addition to the interest groups, Zhou Xiaochuan thought that we should weigh the whole economic level.

He said that some measures may be good for growth, but not necessarily good for prices. Therefore, we need to weigh this big board.

Besides, in the time span, some policies are promising in the short term, but they will not be beneficial to the medium and long term. Some of them will benefit in the medium and long term, and they may have to bear a little price in the short term.

Zhou Xiaochuan also mentioned that direct financing has a strong ability to absorb risks, while indirect financing has weak capacity to absorb risks.

Although China has made great progress in developing direct financing in recent years, indirect financing has also increased rapidly in a high savings country, so the change in proportions is not enough. There is still room for increasing the proportion of direct financing.

He pointed out that in the future main body of direct financing, a very important force is pension. Besides, stock index investment fund and insurance industry are also the main force.

He said that shadow banks, hedge funds and private equity funds can develop steadily, but we should also pay attention to observation.

He also said that some reform measures needed to push forward the development of direct financing would further change the proportion of direct financing and indirect financing.