New appointment for PBOC and State Administration of Foreign Exchange

Zhu Hexin, a banking industry veteran with experience working in the government, has been appointed Party chief of the State Administration of Foreign Exchange.

Experts said the role will likely entail shouldering the key responsibility of guarding the country's $3.1 trillion in foreign exchange reserves.

SAFE said in a statement on Friday that Zhu has succeeded Pan Gongsheng, governor of the People's Bank of China and administrator of SAFE, as Party chief of the administration. Zhu has also been appointed a member of the Party committee of the PBOC, China's central bank, SAFE added.

Before the appointment, Zhu served as chairman of CITIC Group, a State-owned financial conglomerate, since 2020.

Zhu's appointment comes at a time when all eyes are on how China's financial policymakers will fine-tune policies to maintain foreign exchange stability while amplifying financial support for the real economy.

During his tenure as a PBOC deputy governor, Zhu said in 2019 that accommodative monetary steps such as reserve requirement ratio cuts are conducive to the real economy, and more solid economic fundamentals would be good for foreign exchange rate stability.

Liu Chunsheng, an associate professor at the Central University of Finance and Economics, said one policy focus facing Zhu would likely be foreign exchange market stability amid lingering uncertainties, avoiding excessive renminbi exchange rate fluctuations and maintaining the safety of the country's foreign exchange reserves.

SAFE data showed that China's foreign exchange reserves dropped for a third consecutive month to $3.1 trillion by the end of last month, the lowest level since October 2022, as the US dollar strengthened while global financial markets declined.

Liu said financial opening-up should also be top of the agenda, adding that he expects more measures to facilitate cross-border trade, financing and investment and to promote renminbi settlements in cross-border transactions.