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Why MNI
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of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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Free AccessMNI China Daily Summary: Thursday, November 3
EXCLUSIVE: China’s closely linked import and export industries confront higher raw material costs as the yuan continues to fall despite efforts by the central bank to slow its slide, highlighting the need for exporters to prepare for more two-way volatility, policy advisers and analysts told MNI.
POLICY: Hong Kong’s base interest rate was increased 75bp to 4.25%, according to the Hong Kong Monetary Authority (HKMA). The sixth hike this year follows the Federal Reserve's decision to lift U.S. interest rates by the same amount.
POLICY: Hong Kong Monetary Authority chief executive Eddie Yue warned borrowers in the financial hub to brace for more rate hikes as the Federal Reserve telegraphed more tightening of U.S. monetary policy was coming. “Manage your risks accordingly when making borrowing decisions” Yue said in a statement.
LIQUIDITY: The People's Bank of China (PBOC) injected CNY7 billion via 7-day reverse repos with the rates unchanged at 2.00%. The operation led to a net drain of CNY233 billion after offsetting the maturity of CNY240 billion reverse repos today, according to Wind Information. The operation aims to keep liquidity reasonable and ample, the PBOC said on its website.
RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) fell to 1.6006% from 1.7104% on Wednesday, Wind Information showed. The overnight repo average decreased to 1.3320% from the previous 1.7244%.
YUAN: The currency weakened to 7.3200 against the dollar from 7.2825 on Wednesday. The PBOC set the dollar-yuan central parity rate higher for a fifth day at 7.2472, compared with 7.2197 set on Wednesday.
BONDS: The yield on 10-year China Government Bonds was last at 2.6775%, down from Wednesday's close of 2.6850%, according to Wind Information.
STOCKS: The Shanghai Composite Index edged down 0.19% to 2,997.81, while the CSI300 index fell 0.81% to 3,647.90. The Hang Seng Index tumbled 3.08% to 15,339.49.
FROM THE PRESS: China will curb the increase in off-balance sheet debts by local governments, resolve outstanding debts and gradually realise the consolidated supervision of all local debts with unified rules, Caixin reported citing an article by Finance Minister Liu Kun. Most of the off-balance sheet debts were raised by local government financing vehicles many years ago. Liu committed to strengthen the governance of these financing platforms and change the perception that the government would bail out any debt defaults, which is a rare official statement and sends a clear signal, Caixin said.
It is necessary to strengthen financial services to the real economy and manage monetary supply to prevent the macro-leverage ratio from rising rapidly, Securities Times reported, citing an article by Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission. Financial institutions should increase medium and long-term support for advanced manufacturing and strategic emerging industries, and improve financing for SMEs, agriculture sector, rural areas and farmers, as well as people who have newly registered in a city, Guo wrote. It is also necessary to control the "blind" expansion of financial institutions and enhance tools to manage financial risks.
China will pursue economic globalisation, open regionalism and ensure supply chain resilience, while opposing "building walls, decoupling and breaking chains", 21st Century Business Herald reported, citing Lin Nianxiu, deputy director of the National Development and Reform Commission. China welcomes Asia-Pacific Economic Cooperation's (APEC) initiative to promote the flow of key materials and safe personnel exchanges, and is willing to strengthen cooperation with various economies in Asia Pacific to smoothen supply chains and address challenges in logistics, energy and agriculture, Lin was cited as saying.
To read the full story
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.