China's monetary policy is expected.....>

CHINA PRESS: China's monetary policy is expected to remain neutral and balanced

after the Chinese New Year, reported Securities Times on Friday. 

 - Liquidity remains stable and is slightly loose after the PBOC on Thursday

injected CNY350 billion liquidity into the market via open market operations.

Non-bank institutions still face pressure in terms of money supply. 

 - As the Chinese New Year holiday ends, tools which were used to inject

liquidity will steadily be withdrawn, increasing liquidity uncertainty. 

 - However, most financial institutions predict stability in liquidity after the

holiday. In the short term, the PBOC is expected to inject liquidity to maintain

stability in the money market rate. 

 - The PBOC stated the benefits of increasing the rate of OMOs in its

fourth-quarter monetary policy report. The market expects that the central bank

will likely continue increasing OMO rates this year.  

***COMMENTS: The PBOC is likely to increase OMO rates or even the benchmark

interest rates this year, especially while the US Fed is expected to keep

increasing interest rates.