MNI China Daily Summary: Tuesday, March 28

LIQUIDITY: The People's Bank of China (PBOC) conducted CNY278 billion of operations via 7-day reverse repos, with the rates unchanged at 2.00%. The operation led to a net injection of CNY96 billion after offsetting the maturity of CNY182 billion reverse repos today, according to Wind Information. The operation aims to keep banking system liquidity stable at the end of the quarter, the PBOC said on its website.

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) decreased to 1.9933% from 2.0561% on Monday, Wind Information showed. The overnight repo average rose to 1.0788% from the previous 1.0092%.

YUAN: The currency weakened to 6.8845 against the dollar from 6.8820 on Monday. The PBOC set the dollar-yuan central parity rate higher at 6.8749, compared with 6.8714 set on Monday.

BONDS: The yield on 10-year China Government Bond was last at 2.8800%, unchanged from Monday's close of 2.8800%, according to Wind Information.

STOCKS: The Shanghai Composite Index was down 0.19% to 3,245.38, while the CSI300 index decreased 0.32% to 3,999.51. The Hang Seng Index edged up 1.11% to 19,784.65.

FROM THE PRESS: China's banks face tighter margins in the near term as the government's focus on high quality development means lenders cannot rely on fast GDP growth to sustain their business, China Merchants Bank chairman Miao Jianmin told a conference. Miao said the slower economy and turmoil in the real estate market were challenges for banks. Declines in the loan prime rate last year pressured new and existing loans and squeezed margins. Banks need to find new growth channels such as overseas transactions on credit cards, which should grow strongly as outbound tourism recovers, Miao said. (Source: Yicai)

China will align with international trade rules to create a world class business environment, according to China's Premier Li Qiang. Li told foreign business leaders at the China Development Forum that all parties must promote the recovery of the world economy and China will continue integrating with the global economy, regardless of the international economic landscape. The world economic outlook is difficult and complex – authorities must first strengthen confidence and stabilise expectations, Li said. (Source: 21st Century Herald).

China's nationalist newspaper the Global Times has called on the country's multinational companies to promote cooperation and resist economic decoupling with the west. The call follow's Apple CEO Tim Cook's "warm welcome" in Beijing Monday, which contrasted with Washington's reception of TikTok CEO Shou Zi Chew last week. U.S. lawmakers grilled Chew during a congressional hearing over the company's influence and its links to China. The Global Times said, with high inflation and banking failures causing turmoil internationally, China’s stability is positive for the international economy.