Pan Gongsheng: Continuously optimize the intermediate variables of monetary policy, more so as observational, referential, and anticipatory indicators for the financial aggregate.

The recently published "Guidebook for the Central Committee of the Communist Party of China on Formulating the Fifteenth Five-Year Plan for National Economic and Social Development" includes an article by Pan Gongsheng, Governor of the People's Bank of China, entitled "Building a Scientific and Prudent Monetary Policy System and a Comprehensive Macro Prudential Management System". In the article, Pan Gongsheng points out the need to optimize the basic currency release mechanism and monetary policy intermediate variables, and to maintain a reasonable growth in overall financial volume. He advocates gradually building a basic currency release mechanism with Chinese characteristics that balances short, medium, and long-term needs, maintaining ample liquidity in the banking system to meet the financing needs of the real economy. He also emphasizes the importance of continually optimizing monetary policy intermediate variables, shifting focus away from quantitative targets, and using financial volume as more of an observational, reference, and expectation-based indicator in order to create conditions for more effective use of interest rate control.