Zhou Xiaochuan: China’s existing financial tools are still effective in dealing with AI risks

China News Service, Beijing, October 22 (Tao Siyue) The market is currently paying close attention to the development of technologies such as artificial intelligence (AI). Whether the AI ​​boom will give rise to systemic financial risks has triggered discussions. Zhou Xiaochuan, former governor of the People's Bank of China, said in Beijing on the 22nd that the financial sector has long had mature risk management mechanisms and should continue to use existing tools to manage risks. These tools will still be effective now and in the future.

Zhou Xiaochuan made the above statement at the closing ceremony of the 2026 Financial Street Forum Annual Meeting. He said the central bank needs to maintain its core functions amid technological changes and ensure the safety and efficiency of the financial system. In the face of the changing global environment and technological advancement, central banks need to seriously consider their role in policy formulation and find a balance between independence and coordination. This is not only related to the effectiveness of monetary policy, but also to the long-term stability and development of the economy.

He believes that in order to maintain price stability, it is beneficial for the central bank to maintain a high degree of independence; but when it comes to financial stability and opening-up policies, the central bank should coordinate closely with other government departments. The monetary policy system is essentially a "feedback system." The system relies heavily on data input, collecting economic data to determine whether interest rates need to be adjusted or policy directions changed. Therefore, the central bank’s decision-making is not a one-way directive, but is based on real-time monitoring and response to data.

Klaas Knot, former president of the Dutch Central Bank, also said that central banks are currently facing more frequent pressures, but this does not mean that different frameworks are needed, but that more complex environments need to be considered when implementing the framework.