The chairman of China Securities Regulatory Commission (CSRC) Xiao Gang has been officially dismissed from his post, the state-run Xinhua news agency announced on Saturday. The news of Xiao's dismissal comes following recent reports that he is on the verge of being fired.

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Xiao has been immediately replaced by Liu Shiyu, the former head of the Agricultural Bank of China.

Xiao's dismissal comes after CSRC failed to control the volatility in the country's stock market, which has been on a continuous downfall since June last year.

Xiao Gang faced severe criticism especially after failure of his much talked about 'circuit-breaker' mechanism, which he introduced in beginning of this year with the promise that it would stem volatility in stock market.

The 'circuit-breaker' mechanism, however, ended up leading the Shanghai and Shenzhen stock market to lose about $5 trillion. As a result, it was withdrawn from the market only about four days after its introduction.

The circuit-breaker's embarrassing failure sparked off rumors that the government would ask Xiao Gang to resign from his post sooner or later. There were even rumors that he was set to resign.  Xiao, however, continued in his post for over a month.

The news of Xiao's dismissal has been greeted with cheers across China. Many have voiced the opinion on China's Twitter-like social media platform Weibo that the stock market would surely surge on Monday morning after the news of Xiao's dismissal.      

At the moment, neither Xiao nor CSRC have issued a statement about the news of his dismissal.

TagsChinese Stock Market, Xiao Gang, china