MNI China Daily Summary: Thursday, September 26

     POLICY: China will release a further 10,000 tons of pork from reserves

before October in a bid to ensure pork supply -- curbed by the African Swine

Fever -- during the upcoming 7-day National Day holiday, Gao Feng, spokesman of

the Ministry of Commerce said at a briefing today. "Meat supplies are

sufficient, and prices will stabilize," said Gao, adding that China has released

a total of 20,000 tons of pork, 2,400 tons of beef and 1,900 tons of mutton from

reserves so far in September.

     LIQUIDITY: The People's Bank of China (PBOC) injected CNY20 billion via

14-day reverse repos, which led to a net drain of CNY100 billion given the

maturity of CNY120 billion reverse repo, according to Wind Information.

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

institutions (DR007) rose to 2.4592% from 2.4176% on Wednesday, Wind Information

showed. The overnight repo average decreased to 1.6128% from 2.0153% yesterday.

     YUAN: The yuan weakened to 7.1315 against the dollar from Wednesday's close

of 7.1238. The PBOC set the dollar-yuan central parity rate higher at 7.0729,

compared with 7.0724 on Wednesday.

     BONDS: The yield on 10-year China Government Bond was last at 3.1325%, up

from the close of 3.1100% on Wednesday, according to Wind Information.

     STOCKS: The benchmark Shanghai Composite Index fell 0.89% to 2,929.09. Hong

Kong's Hang Seng Index edged up 0.37% to 26,041.93.

     FROM THE PRESS: China released 10,000 tons pork from reserves today

following 10,000 tones a week ago in a bid to cool the soaring pork price,

China.com.cn reported. The reserve release are part of the government's broad

measures to boost hog production and pork supply curbed by the African Swine

Fever, it said.

     Chinese regulators stepped up effort for deleveraging, ordering some

locally based lenders to cap the level of loans they extend to borrowers outside

their regions to the level last year, the 21st Century Business Herald reported

late Wednesday. These local banks must also keep at least half of their lending

to local borrowers, the newspaper said citing an unnamed lender in southeast

China.

     China should boost revenue by requiring state-owned banks and companies to

remit more profits so as to optimize fiscal balances and ease impact from

policies involving tax and fee cuts, the China Business News said in a

commentary. Local governments should also be ordered to cut general spending by

more than 10%, the 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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