RPT-MNI INTERVIEW2: Trump Stagflationary For EZ-ECB's Wunsch

MNI BRIEF: PBOC Launches Outright Reverse Repo For Liquidity

MNI: PBOC Net Injects CNY32.7 Bln via OMO Monday

MNI: PBOC Sets Yuan Parity Higher At 7.1307 Mon; +2.71% Y/Y

CHINA PBOC CONDUCTS CNY241.6 BLN VIA 7-DAY REVERSE REPOS MON

CHINA SETS YUAN CENTRAL PARITY AT 7.1307 MON VS 7.1090

EZ/UK Bond Supply Calendar: UK, Germany Auction on Tuesday

MNI: UNIV OF MICHIGAN CONSUMER SENTIMENT FINAL OCT INDEX 70.5

MNI: BELGIUM OCT BNB BUSINESS SURVEY -12.8

EUROPEAN FISCAL: DE 2025 Budget Gap Grows; Political Risk Is Rising

CANADA: Politics Week: Trudeau Facing More Internal Dissent And Departures

CANADA: Politics Week: Trudeau Faces More Pressure To Resign

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

CHINA: Issuance of CNY2tn of Special Purpose Bonds Urged by Think Tank. 

CHINA
EM BulletAPACChinaEmerging Market NewsBulletGlobalFixed Income BulletsForeign Exchange BulletsRegionMarkets
  • A key government associated think tank (affiliated with the State Council, China’s cabinet) has suggested that up to CNY2 trillion of special government bonds should be issued for the creation of a market stabilization fund (per BBG).
  • The purpose of the fund would be to promote market stability via active participation in (primarily) equity markets.
  • This proposal would run alongside the PBOC’s re-lending facility that allows companies to draw on the swap line for the purposes of buybacks.
  • On the back of a range of stimulus measures announced in September, and following several years of relatively poor performance, China equities performance had been strong until the last week.
  • China’s Shanghai Composite is down over 5% from the early October peak and appears to be treading water for now.
  • However, even with the recent decline, the index remains up over 20% from the mid-September lows.
  • As news from the likes of the IMF show the reservations for China’s GDP growth, further stimulus measures may be required to preserve the equity performance and create a positive environment for growth.
  • The markets may also be awaiting fresh economic news to assess the stimulus impact. Outside of higher frequency updates on the property market etc, we get the Oct PMIs at the end of next week. 
206 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
  • A key government associated think tank (affiliated with the State Council, China’s cabinet) has suggested that up to CNY2 trillion of special government bonds should be issued for the creation of a market stabilization fund (per BBG).
  • The purpose of the fund would be to promote market stability via active participation in (primarily) equity markets.
  • This proposal would run alongside the PBOC’s re-lending facility that allows companies to draw on the swap line for the purposes of buybacks.
  • On the back of a range of stimulus measures announced in September, and following several years of relatively poor performance, China equities performance had been strong until the last week.
  • China’s Shanghai Composite is down over 5% from the early October peak and appears to be treading water for now.
  • However, even with the recent decline, the index remains up over 20% from the mid-September lows.
  • As news from the likes of the IMF show the reservations for China’s GDP growth, further stimulus measures may be required to preserve the equity performance and create a positive environment for growth.
  • The markets may also be awaiting fresh economic news to assess the stimulus impact. Outside of higher frequency updates on the property market etc, we get the Oct PMIs at the end of next week.