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     TOP NEWS: China will boost consumption and diversify export markets to help
support domestic growth, officials at the Ministry of Commerce told reporters
Tuesday. Consumption may further slow this year as trade disputes and global
risks persist, while pressures on the consumer increase. However, the sector
remains a key driver for future growth and MOFCOM said a series of new policies
would help underpin demand.
     LIQUIDITY: The People's Bank of China (PBOC) skipped open market
operations, resulting in a net drain of CNY100 billion as that amount of reverse
repos are maturing, according to Wind Information. The PBOC said the total
liquidity of the banking system is currently at a relatively high level
considering factors including maturing reverse repos. 
     RATE: The 7-day weighted average interbank repo average rate for depository
institutions (DR007) fell to 2.4112% from the close of 2.5147% on Monday: Wind
Information. The overnight repo average fell to 1.9851% from 2.2425%.
     YUAN: The yuan weakened to 6.7810 against the U.S. dollar from the close of
6.7804 on Monday. The PBOC set the dollar-yuan central parity rate at 6.7765
today, compared to 6.7495 set yesterday. 
     STOCKS: The benchmark Shanghai Composite Index rose 0.68% to 2,671.89. Hong
Kong's Hang Seng Index rose 0.1% to 28,171.33.
     BONDS: The yield on the benchmark 10-year China Government Bond was last at
3.09%, down 3 bps from the close of 3.12% on Feb 11, according to brokers
     FROM THE PRESS: China's policy interest rates, such as those on medium-term
lending facilities (MLF), and open market operations (OMO), are further expected
to drop as part of broad loosening measures to stimulate growth, Ming Ming,
analyst at Citic Securities, wrote in a report published Tuesday. Lower rates
may be bullish for the bond market, though its impact on stocks remains unclear,
Ming wrote. The dovish outlook of the U.S. Federal Reserve allows more room for
China to reduce rates, while statements by central bank officials on
market-based rate reform, such as "converging deposit and loan rates and money
rates," signal lower-rate intentions, he said.
     China's economy is in a period of slowing growth that may last one to two
years, as market forces, policies and uncertainties last year pushed the real
economy and capital markets to a lull, the Securities Times said in a
commentary. The slowdown should only be temporary and in the next three to five
years or even longer period, China has potential to grow further, as long as
policymakers don't make fundamental errors, the newspaper said. China's
urbanization is far from completion, market-based reform will drive reallocation
of capital, further boosting production and consumption, it said. 
     China's State Council will support lending to private companies by letting
banks boost capital, according to a readout following Premier Li Keqiang's
weekly cabinet meeting on Monday. While mindful of "a credit flooding,"
regulators will allow banks to increase the issuances of perpetual debt, lower
their barriers for selling preferred shares and convertible debt, allow funds
and annuities to participate, and encourage overseas financial institutions to
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