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     BEIJING (MNI) - EXCLUSIVE: China's inflation is likely to stay moderate
this year, Ning Jizhe, the head of the National Bureau of Statistics, told MNI.
"Pork prices have been declining on a monthly basis," said Ning, when asked
whether the high level pork prices will continue to fuel overall inflation. Ning
spoke in an interview on the side line of the 24th China Capital Market Forum in
Beijing on Saturday.
     POLICY: China shrank the scale of its so-called shadow banking industry by
CNY1.6 trillion in the last three years, as it reined in activities such as
wealth management and off-balance sheet transactions, Huang Hong, a vice
chairman of China Banking and Insurance Regulatory Commission, said at a press
conference on Monday.
     POLICY: China should urgently rebalance the state, employers and
individuals-supported three-pillar pension structure to address its fast-aging
population, require individuals increase contributions and ease fiscal burdens,
several financial regulatory officials said on Saturday. State pension funds
should be allowed to invest in more markets for higher returns while providing
long-term capital to reduce market volatility and lower leverages, the officials
said in a forum by Global Asset Management Forum (GAMF) held in Beijing.
     POLICY: China should be "particularly cautious" when deciding on increasing
fiscal deficit, as the rising debt level may lead to either regional or systemic
financial crisis, Gao Peiyong, Vice President of the Chinese Academy of Social
Sciences, said on Saturday. "The increase should be restrained" even if
necessary, said Gao at the China Capital Market Forum in Beijing.
     LIQUIDITY: The People's Bank of China (PBOC) skipped open market operations
for the 14th day, leaving liquidity unchanged, according to Wind Information.
Total liquidity in the banking system is relatively high, PBOC said.
     RATES: The seven-day weighted average interbank repo rate for depository
institutions (DR007) rose to 2.4451% from Friday's close of 2.3750%, Wind
Information showed. The overnight repo average increased to 2.0598% from
Friday's 1.7689%.
     YUAN: The currency strengthened to 6.8942 against the dollar from Friday's
close of 6.9290. PBOC set the dollar-yuan central parity rate 88 bps lower at
6.9263.
     BONDS: The yield on 10-year China Government Bonds was last at 3.1175%, up
from Friday's close of 3.1050%, according to Wind Information.
     STOCKS: The Shanghai Composite Index rose 0.75% to 3,115.57. Hong Kong's
Hang Seng Index gained 1.11% to 28,954.94.
     FROM THE PRESS: China's balance of payment will remain in equilibrium
generally and cross-border capital inflows will increase in 2020, said Pan
Gongsheng, Administrator of the State Administration of Foreign Exchange (SAFE),
according to Economic Daily. Risk from China's foreign debts is controllable,
Pan was cited  saying.
     Chinese economists estimate the liquidity gap in January will be between
CNY2.8 trillion and CNY3.2 trillion, according to a survey by Xinhua News
Agency. Over half of the surveyed economists see a small possibility that China
will cut the rates for central bank repos in January, and more than half expect
the Loan Prime Rate unchanged this month, Xinhua reported.
     China is expected to inject over CNY2 trillion state-owned capital into the
national social security fund this year, the Securities Daily reported by citing
Li Zhan, Chief Economist of Zhongshan Securities. The government has vowed to
transfer 10% in state-owned capital to the social security fund by the end of
2020, the daily said. 
--MNI Beijing Bureau; +86 (10) 8532-5998; email: archie.zhang@marketnews.com
--MNI Beijing Bureau; +86 10 8532 5998; email: william.bi@mni-news.com
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