BEIJING, Oct 12, 2007 (AFP) - Chinese central bank governor Zhou Xiaochuan is "very likely" to be replaced when the Communist Party gathers for its five-yearly meeting next week, a Chinese financial official said Friday.

"It's absolutely not retirement. It's very likely he will be appointed to another position," the official told AFP, declining to be identified.

Zhou is 59 years old, giving him another six years in government before mandatory retirement, barring some major mistake.

"He's been working as a central bank governor for five years, and he is very well respected," said Huang Yiping, a Hong Kong-based Citigroup economist.

"So I'm sure at least from investors' and international policy makers' perspective, it will be good news if he stays on, but the leaders might have some different arrangement," he said.

Some observers speculated Friday Zhou may be replaced so he can take on more important responsibilities, such as that of vice premier.

The rumour mill has been running overtime in Beijing recently in preparation for the 17th Communist Party Congress, which begins Monday and will last for about a week.

Much speculation has been spent on the possible candidates for the position of heir-in-waiting ahead of the expected retirement of President Hu Jintao in 2012.