Trial now

Reversing Overnight Risk-Off Tone


Remains Vulnerable


Pres Biden Budget Proposal Ests


Needle Still Points South


Resistance Remains Intact

     BEIJING (MNI) - POLICY: China and the U.S. have been "closely
communicating" on issues related to signing the interim trade deal, spokesperson
Gao Feng of the Ministry of Commerce said on Thursday. The two countries are
performing necessary procedures including legal reviews, translations and
proofreading, Gao said at a regular Thursday briefing declining to comment
further when asked about Chinese purchases of American pork and soybeans.
     LIQUIDITY: The People's Bank of China (PBOC) skipped open market
operations, draining net CNY30 billion given the maturity of reverse repos,
according to Wind Information. Total liquidity in the banking system is
relatively high due to an increase in fiscal expenditures near the end of the
year, PBOC said.
     RATES: The seven-day weighted average interbank repo rate for depository
institutions (DR007) decreased to 2.3472% from 2.4346% on Wednesday, Wind
Information showed. The overnight repo average fell to 0.8382% from 0.9289% on
     YUAN: The yuan weakened to 6.9984 against the dollar from 6.9823 on
Wednesday. PBOC set the dollar-yuan central parity rate lower at 6.9801 from
7.0067 on Wednesday.
     BONDS: The yield on 10-year China Government Bonds was last at 3.1400%,
down from the close of 3.1600% on Wednesday, according to Wind Information.
     STOCKS: The Shanghai Composite Index gained 0.85% to 3007.35 as shares of
securities companies advanced. The Hong Kong exchange is closed for Christmas. 
     FROM THE PRESS: Market participants are bullish on the Chinese Yuan and
expect the currency to trade below 7.0 against the dollar next year, the
Shanghai Securities News reported citing bank reports. Bank of China
International predicted USD-CNY to range 6.7 and 7.2 next year, according to the
     A total of CNY170.63 billion Chinese local government special-purpose bonds
may be issued in January, the Securities Daily reported. The issuances will
significantly boost infrastructure investment and create jobs in Q1, the
newspaper reported citing experts.
     Home prices in China may decline slightly next year while more
consolidations among developers can also be expected, the China Securities
Journal reported. The central government reiterated that it won't allow real
estate as a short-term economic stimulus tool, which further stabilizes market
outlook, said the journal citing Zou Linhua, a researcher at the Chinese Academy
of Social Sciences.
--MNI Beijing Bureau; +86 (10) 8532-5998; email:
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