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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.
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Free AccessMNI China Daily Summary: Thursday, September 28
EXCLUSIVE: The resumption of regular economic China-U.S. dialogue via the creation of working groups shows both countries want to avoid a costly decoupling, but any substantial breakthrough – such as tariff reduction – remains a distant prospect, policy advisors and market analysts told MNI.
LIQUIDITY: The People's Bank of China (PBOC) conducted CNY101 billion via 7-day reverse repo and CNY508 billion via 14-day reverse repo, with the rate unchanged at 1.80% and 1.95%, respectively. The operation has led to a net injection of CNY440 billion after offsetting the maturity of CNY169 billion reverse repos today, according to Wind Information.
RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) increased to 2.2358% from 1.9513%, Wind Information showed. The overnight repo average rose to 2.1929% from the previous 1.6957%.
YUAN: The currency strengthened to 7.3002 against the dollar from 7.3088 on Wednesday. The PBOC set the dollar-yuan central parity rate higher at 7.1798, compared with 7.1717 on Wednesday. The fixing was estimated at 7.3224 by Bloomberg survey today.
BONDS: The yield on 10-year China Government Bonds was last at 2.7300%, down from Wednesday's close of 2.7450%, according to Wind Information.
STOCKS: The Shanghai Composite Index closed up 0.10% at 3,110.48, while the CSI300 index decreased 0.30% to 3,689.52. The Hang Seng Index lost 1.36% to 17,373.03.
FROM THE PRESS: Inner Mongolia plans to issue CNY66.32 billion of refinancing bonds to repay corporate accounts in arrears that the government guaranteed before 2018. This is the first time a local government has used refinancing bonds to pay off debt in arrears, compared to the previous use of repaying the principal of maturing local-government bonds as well as swapping out existing local implicit debts. This shows that the Politburo's “basket of plans” to address local government indebtedness includes, not only resolving off-balance borrowings via local-government financing vehicles, but also repaying arrears. (Source: Caixin)
Services consumption will help support the economy next week during the week-long Mid-Autumn Festival and National Day holiday. A total of 217 million train tickets were sold from Sept 13-23, according to data by the China Railway, while the Civil Aviation Administration estimates over 21 million passengers will travel by plane during the break, with an average of over 17,000 flights a day. The popularity of long journeys to Xinjiang and Tibet has increased by over 300% y/y, while outbound tourism will also hit a new high to grow about 500% over the May Day holiday, according to data from online travel booking platforms. (Source: Securities Daily)
Policymakers will correct unilateral and procyclical behaviour to keep the yuan stable and avoid overshooting, according to the People’s Bank of China. At its recent Q3 Monetary Policy Committee meeting, the central bank said it would strengthen government investment and policy incentives to stimulate private investment, and increase support for key areas like inclusive finance, green development, technological innovation, and infrastructure construction. On housing, the PBOC said it would facilitate an adjustment mechanism for new first-home loan interest rates, and promote the implementation of lowering existing first-home loan interest rates. Overall, authorities believe the domestic economy continues to recover but demand remains insufficient. (Source: PBOC Website)
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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.