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CHINA MARKETS: Yuan Stronger; Rates Drop; Stocks Down

     BEIJING (MNI) - The yuan rose against the U.S. dollar Wednesday morning
even though the People's Bank of China set a weaker daily fixing. 
     The yuan was last at 6.5705 against the U.S. unit, compared with the
official closing price of 6.5859 on Tuesday. 
     The PBOC set the yuan central parity rate against the U.S. dollar at 6.5670
on Wednesday, weaker than Tuesday's 6.5530. It was the second straight day the
PBOC has set the fixing weaker.
     Money market rates fell Wednesday morning after the PBOC injected CNY30
billion in liquidity via open-market operations. The seven-day repo average was
last at 2.7854% Wednesday, lower than Tuesday's average of 2.9366%. The
overnight repo average was at 2.7551%, lower than Tuesday's 2.8986%.
     The yield on benchmark 10-year China government bonds was last at 3.5789%,
up from the previous close of 3.5724%, according to Wind, a financial data
     Stocks were slightly down, led lower by the cement and steel sectors. The
benchmark Shanghai Composite Index was last down 0.03% at 3,355.97. Hong Kong's
Hang Seng Index was 0.23% higher at 28,115.23. 
--MNI Beijing Bureau; +86 (10) 8532-5998; email:
--MNI Beijing Bureau; +86 (10) 8532-5998; email:
[TOPICS: M$A$$$,M$Q$$$,M$$FI$,MN$FI$,MN$FX$]

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