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Xi’s Cryptic Bond Comments Hint at PBOC Becoming More Like Fed
A resurfaced speech from Chinese President Xi Jinping suggests policymakers may start trading government bonds to regulate liquidity in the market, pushing the nation toward strategies used by the Federal Reserve and other major central banks around the world. Xi’s call for the People’s Bank of China to “gradually increase the buying and selling of government bonds” in its open market operations sparked a frenzy of speculation among traders last week. The remarks — made in October but publicized recently in a new book and newspaper article — may hint at a policy pivot for a central bank that hasn’t made ... (full story)