MNI China Daily Summary: Thursday, March 19

     BEIJING (MNI) - EXCLUSIVE: The second phase of trade talks between China

and the U.S. could be delayed until after the U.S. presidential election in

November, as the coronavirus pandemic disrupts the global economy and tensions

between the two countries escalate, government advisors told MNI, adding that

meeting commitments agreed under phase one will also be very difficult.

     POLICY: China's exporters may encounter weak external demand and reduced

orders in coming months, as the coronavirus pandemic disrupt global trade, said

Jiang Fan, a senior inspector of the Foreign Trade Division at the Ministry of

Commerce at a briefing on Thursday. The ministry will use fiscal, tax, financial

and export credit guarantee policy support to help exporters, said Jiang.

     LIQUIDITY: The People's Bank of China (PBOC) skipped open market operations

for the third day, leaving liquidity unchanged, according to Wind Information.

Liquidity in the banking system is reasonable and ample, PBOC said on its

website.

     RATES: The 7-day weighted average interbank repo rate for depository

institutions (DR007) decreased to 1.6290% from Wednesday's close 1.6763%, data

by Wind Information showed. The overnight repo average fell to 0.8355% from the

previous 0.9548%.

     YUAN: The currency weakened to 7.0910 against the dollar from Wednesday's

7.0260 close. PBOC set the dollar-yuan central parity rate higher at 7.0522 on

Thursday, compared with 7.0328 on Wednesday.

     BONDS: The yield on 10-year China Government Bonds was last at 2.7250%, up

from Wednesday's close of 2.7200%, according to Wind Information.

     STOCKS: The Shanghai Composite Index lost 0.98% to 2,702.13. Hong Kong's

Hang Seng Index slipped 2.61% to 21,709.13.

     FROM THE PRESS: China's top decision-making body urged businesses in Wuhan

to "gradually" resume operations and local governments to facilitate the

movement of people from Hubei province to other parts of the country, according

to a statement following a meeting of the Politburo Standing Committee.

Provinces with low risks of infection should promote a return of normal life and

people traveling within these regions won't need to be subject to

self-isolation, the committee said. China will also step up measures to deal

with cases entered China from other countries, it said.

     China should increase its deficit-to-GDP ratio as an expansionary fiscal

policy to boost the economy, the China Securities Journal said in a front-page

commentary. Risks from higher government debt are controllable and the current

deficit ratio is relatively low, providing ample room for an increase, the

newspaper said.

     China does not wish to see any more mutual expulsions of journalists

between the two countries, the Global Times said in its editorial. The U.S.

media should turn to Secretary of State Mike Pompeo for justice and China won't

back down if the U.S. carries out further retaliations, the newspaper said. The

media plays a different role in the two societies with different political

systems, so the U.S. shouldn't use this as a base to expel Chinese journalists,

the state-run newspaper said.

--MNI Beijing Bureau; +86 (10) 8532-5998; email: wanxia.lin@marketnews.com

--MNI Beijing Bureau; +86 10 8532 5998; email: william.bi@mni-news.com

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