A bold step forward looms in the decades-long reform of how China conducts monetary policy, with Governor Pan Gongsheng leading the central bank to explore changes that would move it closer to how global peers including the US Federal Reserve (Fed) operate. Under the proposals laid out by Pan in a June speech, the People’s Bank of China (PBOC) would switch to using just one key short-term policy rate and start trading government bonds to manage liquidity. While crucial differences with western peers would remain — there’s no claim of independence from the government and China remains opposed to quantitative easing — ... (full story)