MNI China Daily Summary: Wednesday, July 15

     LIQUIDITY: The People's Bank of China (PBOC) injected a net CNY400 billion

via its one-year medium-term lending facility (MLF) Wednesday, with the rate

unchanged at 2.95%, and no reverse repos matured today, according to a statement

on the PBOC website. The injection rolled over MLFs and targeted medium-term

lending facilities (TMLF) maturing this month, the PBOC said on its website. In

total, CNY697.7 billion MLFs are to mature in July, according to Wind

information.

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

institutions (DR007) rose to 2.1554% from Tuesday's close of 2.1023%, Wind

Information showed. The overnight repo average increased to 2.0388% from the

previous 1.6646%.

     YUAN: The currency strengthened to 6.9986 against the dollar from 7.0188 on

Tuesday. PBOC set the dollar-yuan central parity rate lower at 6.9982 , compared

with the 6.9996 for Tuesday.

     BONDS: The yield on 10-year China Government Bond was last at 2.9950%, down

from the close of 3.0000% on Tuesday, according to Wind Information. 

     STOCKS: The Shanghai Composite Index fell 1.56% to 3,361.30 as technology

companies lost the most. Hang Seng Index edged up 0.01% to 25481.58.

     FROM THE PRESS: China should further increase infrastructure investment to

boost sluggish demand dragging growth, the Economic Information Daily reported

citing Zhang Liqun, a researcher with the Research Development Centre of the

State Council. More than half of the companies surveyed by Zhang said they

didn't have sufficient orders, which may have prevented a full revival of

production, Zhang was reported saying. China's GDP growth will need to reach 4%

by the end of this year if the government was to meet the target of creating 9

million jobs, Zhang added.

     China needs to retaliate against the U.K. for its ban on Huawei while

avoiding a full-scale confrontation, Global Times said in its editorial. Any

retaliation should be public and painful for the UK, the editorial said. In the

long run, the UK has no reason to turn against China as the Hong Kong issue is

fading out and Huawei may return to the UK market, the newspaper said. The UK

has given a buffer period for companies to move away from Huawei, indicating

that banning Huawei is a difficult action to achieve in practice, the editorial

said.

--MNI Beijing Bureau; +86 (10) 8532-5998; email: archie.zhang@marketnews.com

--MNI Beijing Bureau; +86 10 8532 5998; email: william.bi@mni-news.com

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