China Press Digest: Tuesday, August 1

     BEIJING (MNI) - The following are highlights from the China press on

Tuesday, August 1:

     With domestic financing for property developers tightening real-estate

companies' overseas bond issuance rebounded to a record in June and July after

cooling in May, Caixin reported late Monday. From Jan. 1 to July 25 mainland

property developers issued 60 bonds totaling CNY196.45 billion - more than in

all of 2016, Caixin said quoting Bloomberg data. The amount was CNY81.3 billion

in June - a single-month record. Unidentified property experts said the wave of

bond issuance overseas was a result of pressure on developers to repay loans,

diversify financing and policy guidance. But the news media has reported the

National Development and Reform Commission stopped approving property

developers' bond issuance overseas from the second quarter and the increase in

June may be from approvals received earlier. Therefore, the trend in issuance of

bonds by property companies for the rest of the year is unclear, it said.

(Caixin)

     The yuan is expected to extend two-way fluctuations in the short term and

now is a good time for the range of exchange-rate movements to increase, the

China Securities Journal said Tuesday. As China's economic fundamentals and

cross-border capital flows improve - and demand and supply in the

foreign-exchange market is balanced - the yuan may continue two-way

fluctuations: which shows the trend of the yuan will likely be to appreciate

against the U.S. dollar, the newspaper said. The yuan won't continue to be

steady as it is now, unidentified analysts said in the report. While the

People's Bank of China has taken measures to stabilize the exchange rate,

marketization hasn't changed. The measures, including current pricing schemes,

are temporary tools providing a buffer period to allow time for the market to

adjust to increases in exchange-rate flexibility. But depreciation pressure on

the yuan continues, the newspaper said. (China Securities Journal)

     Market insiders said liquidity in August would be slightly better than in

July and overall it would return to a "neither loose nor tight" status, the

China Securities Journal said Tuesday. The People's Bank of China's open-market

operations in July ended with a net injection of CNY472.5 billion - the fourth

consecutive month of net injection. Demand for money is strong at the end of the

month and market liquidity is tight, the newspaper said. Large amounts of

reverse repos maturing in August will also put pressure on liquidity. (China

Securities Journal)

--MNI Beijing Bureau; +86 (10) 8532-5998; email: iris.ouyang@marketnews.com

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