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EXCLUSIVE: Chinese authorities are likely to impose additional restrictions on real estate-related transactions in some of the country's biggest cities in the second half of 2020 to stem property market overheating, policy advisors and a market analyst told MNI. Officials from ten housing hotspots including Shenzhen and Nanjing have already been summoned to a meeting with the central government, noted Yan Yuejin, research director at the Shanghai E-House Real Estate Research Institute, adding that homebuyers are likely to face tighter lending conditions and that quotas for loans to property developers could be reduced.

POLICY: China will roll out new policies to stabilize foreign trade in a timely manner, focusing on helping trade companies prevent order risks and obtain financing, Gao Feng, spokesman for the Ministry of Commerce said Thursday. MofCom will make better use of export credit insurance, provide credit enhancement and further expand export credit for private and exporters, said Gao. However, exporters will be encouraged to reposition to reposition in the home market, then develop cross-border e-commerce and overseas warehouses, Gao added.

POLICY: China's top economic planner said Washington's controls on exports had contributed to lower-than-expected purchases from the U.S., along with reduced demand during the pandemic. Ning Jizhe, the deputy head of the National Development and Reform Commission, told the U.S.-China Business Council in a meeting last week that both countries should work together to overcome any difficulties and foster win-win cooperation, according to a statement released on the Commission's website today.

POLICY: China should be on guard against narrow-minded nationalism and populism, instead focus on moves to engage more with the wider world to counter threats to its influence and established global networks, Liu Shijin, a top government advisor, wrote in an article on Sina.com.cn. China should look to introduce policies including "zero tariffs" when necessary to show its leadership and good intentions, wrote Liu, a deputy director of the economy committee of the Chinese People's Political Consultative Conference.

LIQUIDITY: The People's Bank of China (PBOC) injected CNY50 billion via 7-day reverse repos with the rate unchanged, offsetting the maturing CNY50 billion reverse repos and leaving liquidity unchanged, according to Wind Information. This aims to keep the total liquidity reasonable and ample, the PBOC said on its website.

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) rose to 2.1829% from Wednesday's close of 2.1381%, Wind Information showed. The overnight repo average decreased to 1.3669% from the previous 1.4372%.

YUAN: The currency weakened to 7.0064 against the dollar from 6.9997 on Wednesday. The PBOC set the dollar-yuan central parity rate lower at 6.9902, compared with Wednesday's 6.9969.

BONDS: The yield on 10-year China Government Bond was last at 2.9325%, down from the close of 2.9525% on Wednesday, according to Wind Information.

STOCKS: The Shanghai Composite Index fell 0.23% to 3,286.82, while the CSI300 index rose 0.49% to 4,656.15. Hang Seng Index lost 0.69% to 24,710.59.

FROM THE PRESS: China plans to boost exports by providing trade-oriented businesses with capital and market support, the People's Daily said citing the weekly State Council meeting held Wednesday. The initiatives aim to attract foreign investment through an enhanced policy environment which expands the service sector, the report said. The government also stressed the need to increase employment opportunities and incomes for rural migrant workers by providing them with more incentives to settle in cities, encouraging their participation in infrastructure construction and helping fund their business ventures, the Daily said.

China's Ministry of Finance urged officials to complete the issuance of new local government special bonds by the end of October, the Securities Daily reported. Provincial governments are given the autonomy to allocate the funds to speed up projects that support urban renewal and the construction of public health facilities as a priority, the newspaper said citing a document from the Ministry. Local authorities must use the funds for public welfare projects that generate returns and are banned from rolling over existing debts or paying the salaries of civil servants, the document read.

China has disbursed CNY200 billion to 18 provinces from special-purpose local government bonds to help regional lenders replenish capital, with each province receiving around CNY11.1 billion, the 21st Century Business Herald reported in an unsourced article. City and rural commercial banks are under the greatest pressure as their capital adequacy ratios, at 12.65% and 12.81% in Q1, are close to the so-called red line of 10.5% set by regulators. The ratios for major state-owned banks, joint-stock banks and private banks are 16.14%, 13.44% and 14.44%, the newspaper said.

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