MNI China Press Digest Aug 13: Credit Help, Pro-Growth,Yuan

The following lists highlights from Chinese press reports on Friday:

• China's new loans and aggregate financing will be supported by accelerated local government bond sales as well as the use of structural monetary tools intended to promote carbon emission cut, support SMEs and high-end manufacturing, the Securities Times said in a front-page commentary, downplaying the weak financial data released this week. Though companies' longer-term loans in July were less than expected and aggregate finance continued to slow, it is too early to say financial demand in the real economy is weakening based on a single month of data, the newspaper said.
• China may steer its policies to supporting the economy, including faster issuances of local government bonds and marginally boost liquidity, as the economy faces more headwinds in the second half including slowing exports, Yicai.com reported citing economists. While July's loan data showed less than expected credit growth, it was likely due to seasonal patterns, as historically the first month of a quarter tends to be weak, the newspaper said citing macro strategist Wu Yinzhao of Avic Trust. Monetary policy boost, including a RRR cut or more MLF and OMO operations, may be timed to help the sales of local government special bonds, the news service said.
• China should maintain the steady strengthening of the yuan in the longer term to help expand domestic demand and serve its new development model with the domestic market as the mainstay, according to a commentary in the Securities Times. A moderate appreciation of the yuan can reduce the cost of imported intermediate products and lower prices of final products sold in China, thereby increasing consumers' purchasing power, the newspaper said. A stronger yuan may also encourage enterprises to produce higher-quality final products and upgrade domestic consumption, the newspaper said. Japan and Germany witnessed such development during which their appreciating currencies helped reduce the dependence on the international markets, eliminate outmoded production capacities and optimize economic structures, the newspaper added.