MNI China Daily Summary: Tuesday, December 3

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

for the tenth day, leaving liquidity unchanged as no reverse repos mature today,

according to Wind Information. The total liquidity in the banking system is

relatively high, PBOC said.

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

institutions (DR007) fell to 2.2876% from 2.3775% on Monday, Wind Information

showed. The overnight repo average decreased to 2.1032% from 2.2249% on Monday.

     YUAN: The yuan weakened to 7.0471 against the dollar from 7.0449 on Monday.

PBOC set the dollar-yuan central parity rate lower for a second day at 7.0223,

compared with Monday's 7.0262.

     BONDS: The yield on 10-year China Government Bonds was last at 3.1875%,

down from the close of 3.2100% on Monday, according to Wind Information.

     STOCKS: The Shanghai Composite Index edged up 0.31% to 2,884.70, helped by

electronic vehicle shares. Hong Kong's Hang Seng Index decreased 0.20% to

26,391.30.

     FROM THE PRESS: The PBOC may increase the magnitude of its countercyclical

adjustments using monetary tools including lowering the 1-year Loan Prime Rate,

the medium-term lending facilities and 7-day repo market rates, seeking to

improve macroeconomy and hard growth targets, the Securities Daily reported

citing Wang Qing, chief macroeconomic analyst at credit rating agency Dongfang

Jincheng. Other measures include cutting lenders' required reserves to further

aid small businesses, the daily quoted Wang as saying.

     Relaxing controls over the real estate market will create bubbles posing

risks to the economy, the Economic Daily said in an editorial. Regional

authorities should be cautious in adjusting real estate policies despite

decreasing sales, investment and slower economic growth, the newspaper said.

     China will ensure pork supplies during the Chinese New Year at the end of

January and also during the National People's Congress session in March,

according to a statement on the Ministry of Agriculture's website. The ministry

will ensure pork capacity grew to its previous level by the end of 2020,

Minister Han Changfu said at an internal meeting, according to the statement.

     President Xi Jinping and his Russian counterpart Vladimir Putin witnessed

the opening ceremony of the east-route of China-Russia natural gas pipeline on

Monday, with Xi hailing it a flagship project for China-Russia energy

cooperation, China Daily reported today. Under a 30-year agreement between

Russian company Gazprom and China National Petroleum Corp signed in May 2014,

the project is expected to pump some 38 billion cubic meters of Russian natural

gas to China annually, which is equal to about 13.6 percent of China's gas

consumption in 2018, the daily 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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