MNI China Daily Summary: Wednesday, April 3

     DATA: The Caixin services PMI index in March rose to 54.4, the highest

level in more than a year, from 51.1 in February. Many companies surveyed by

Caixin said improved demand and new product launches helped a rebound in new

orders. New export orders also surged to the second-highest since Dec 2017,

reflecting recovered external demand, Caixin said.

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

for the 11th trading day, leaving liquidity unchanged as no reverse repos

matured, according to Wind Information. Total liquidity in the banking system is

at a relatively high level, the PBOC said.

     RATE: The 7-day weighted average interbank repo rate for depository

institutions (DR007) fell to 2.2000% from Tuesday's close of 2.3784%, Wind

Information showed. The overnight repo average decreased to 1.6600% from

Tuesday's 1.9456%.

     YUAN: The Chinese currency strengthened to 6.7072 against the dollar from

Tuesday's close of 6.7213. The PBOC set the dollar-yuan central parity rate at

6.7194 today, compared with 6.7161 on Tuesday.

     BONDS: The yield on the benchmark 10-year China Government Bond was last at

3.215%, up 5 bps from Tuesday's close, according to brokers. 

     STOCKS: The benchmark Shanghai Composite Index rose 1.24% to 3,216.30, the

highest level since March 23, 2018, fueled by a rally by brokerage shares. Hong

Kong's Hang Seng Index rose 1.22% to 29,986.39, the highest level since June 19,

2018.

     FROM THE PRESS: The PBOC was downplaying the likelihood of cutting the

reserve requirement ratio when it made the unusual move of publicly denying a

rumored cut that came out last Friday, the Securities Times commented on its

front page. The false information could have triggered housing speculation or

even weakened the yuan, the newspaper said.

     Overseas investors increased holdings of Chinese bonds for a fourth month

in March, China Securities Journal reported citing data by the China Central

Depository & Clearing Co. At the end of last month, overseas investors held

record CNY1.515 trillion Chinese bonds, up CNY2.785 billion from a month ago,

the newspaper 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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