MNI China Daily Summary: Tuesday, February 18
POLICY: Chinese officials will introduce a new version of the market access negative list soon to open infrastructure and major national scientific research infrastructure to private enterprises, Zheng Bei, the NDRC's deputy director, told state China Central Television.
LIQUIDITY: The PBOC conducted CNY48.9 billion via 7-day reverse repos, with the rate unchanged at 1.50%. The operation led to a net drain of CNY484.1 billion after offsetting the maturity of CNY33 billion 7-day reverse repos and CNY500 billion 1-year MLF today, according to Wind Information.
RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) increased to 2.3447% from 2.0567%, Wind Information showed. The overnight repo average rose to 1.9655% from 1.9386%.
YUAN: The currency weakened to 7.2783 against the dollar from the previous 7.2592. The PBOC set the dollar-yuan central parity rate lower at 7.1697, compared with 7.1702 set on Monday. The fixing was estimated at 7.2570 by Bloomberg survey today.
BONDS: The yield on 10-year China Government Bonds was last at 1.6800%, up from the close of 1.6500% previously, according to chinamoney.com.cn.
STOCKS: The Shanghai Composite Index was down 0.93% to 3,324.49, while the CSI300 index lost 0.88% to 3,912.78. The Hang Seng Index edged up 1.59% at 22,976.81.
FROM THE PRESS: The yuan is expected to remain around 7.3 against the U.S. dollar in the short-term, according to analysts from CITIC Securities. Market sentiment has improved amid capital inflows to the Chinese stock market driven by DeepSeek, while pressure on China-U.S. interest spreads have eased as the dollar weakened, said Li Liuyang, chief FX analyst at China International Capital Corporation. Regulators will promptly use policy tools to stabilise the yuan should it move sharply in the future or deviate from fundamentals, said Wang Qing, chief macro analyst at Golden Credit Rating. (Source: China Securities Journal)
Guangdong province has taken the lead in purchasing vacant land from housing developers using local government special bonds, with nine cities planning to buy 63 plots valued at CNY18.3 billion, Securities Times reported, noting the transactions generally came with a discount of 10-20% on land transfer price. Revitalising the large amount of undeveloped land in cities will help improve the liquidity of developers and stabilise market expectations, the newspaper said, citing analysts.
China’s President Xi Jinping called on the Party and state to ensure all forms of ownership have equal access to the nation’s factors of production and can compete fairly. Xi, speaking at a symposium with private sector leaders, said entrepreneurs should show their talents, serve the country and promote common prosperity to support China’s path to modernisation. Officials should address overdue payments to private enterprises and rectify illegal charges and seizures, Xi noted.