MNI China Daily Summary: Wednesday, March 11

     DATA: China's February aggregate financing to the economy plunged to less

than a fifth of January's level as the coronavirus outbreak halted much of the

business activities. At CNY855.4 billion, it was the lowest in almost four years

and less than CNY1.59 trillion expected by the market, data released Wednesday

by the People's Bank of China (PBOC) showed. M2 money supply rose 8.8% y/y,

accelerating from 8.4% rise in January to a two-year high, outshining the 8.5%

forecast. New loans totalled CNY905.7 billion, less than a third of January's

CNY3.34 trillion, also missing projected CNY1.12 trillion.

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

for the 17th day, leaving liquidity unchanged, according to Wind Information.

Liquidity in the banking system is reasonable and ample, PBOC said on its

website.

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

institutions (DR007) increased to 2.2385% from Tuesday's close 2.1868%, Wind

Information showed. Overnight repo average rose to 2.0967% from 2.0035%

yesterday.

     YUAN: The yuan weakened to 6.9499 against the dollar from Tuesday's close

6.9469. PBOC set the dollar-yuan central parity rate higher for a second day at

6.9612, compared with Tuesday's 6.9389, the biggest daily drop since Feb. 4,

2020.

     BONDS: The yield on 10-year China Government Bonds was last at 2.6150%, up

from Tuesday's close of 2.6100%, according to Wind Information.

     STOCKS: The Shanghai Composite Index lost 0.94% to 2,968.52. Hong Kong's

Hang Seng Index fell 0.63% to 25,231.61.

     FROM THE PRESS: The situations in the coronavirus outbreak epicentre of

Wuhan city and Hubei province have improved and an important milestone has been

achieved through hard work, President Xi Jinping said during his first visit to

Wuhan since the outbreak, the official Xinhua News Agency reported late Tuesday.

The task of epidemic control was still arduous, and prevention remained the top

priority, Xinhua cited Xi as saying.

     Chinese publicly listed companies in parts of Hubei province outside the

epidemic epicentre Wuhan city have gradually resumed production from Tuesday,

the Shanghai Securities Journal reported. Some companies in Wuhan have also

resumed operations on a small scale, the newspaper said. As the situation

improves, traffic checkpoints inside Hubei set to slow the epidemic earlier have

largely been lifted, the newspaper said.

     The PBOC clamped down on illegal high-interest-rate deposits that tempted

homebuyers to withdraw funds to pay mortgages in advance, according to a report

in Securities Times based on interviews with depositors. The central bank wants

to alleviate pressure in the money market and lower financing costs by

tightening the regulation on high-interest deposits, the newspaper said citing

Zhao Yaxun, an analyst with the Citic Foundation for Reform and Development

Studies.

--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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