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MNI China Daily Summary: Wednesday, November 7

     TOP NEWS: The People's Bank of China (PBOC) will increase its refinancing
and rediscount activities according to market demand should an earlier CNY300
billion be used up, Governor Yi Gang said in an interview with Xinhua News
Agency on Tuesday. The central bank will inject liquidity to private companies
mostly through bonds, credits and equities, Yi told Xinhua.(For full story see:
     POLICY: China is likely to reduce tariffs faster and further to boost
imports, speed economic rebalancing and underpin the opening-up of the economy,
a leading trade expert told MNI in an interview. "We can expect China to lower
its average tariff to less than 3% over time from 7.5% currently," said He
Weiwen, a former economic and commercial counselor at the Chinese Consulates
General in New York and San Francisco. (For full story see:
     DATA: China's foreign exchange reserves fell for the third consecutive
month, declining $33.9 billion to $3.05 trillion in October, the PBOC said
Wednesday. The fall compared to a decline of $22.7 billion in September and was
the biggest since Dec 2016, when they decreased $41.08 billion from the previous
     LIQUIDITY: The PBOC skipped open market operations (OMOs) on Wednesday. No
reverse repos mature today, according to Wind Information. The central bank said
liquidity in the banking system is at a reasonable and ample level.
     RATE: The 7-day weighted average interbank repo average rate for depository
institutions (DR007) decreased to 2.5610% from Tuesday's close of 2.5652%, Wind
Information showed. The overnight repo average decreased to 2.0666% from
Tuesday's 2.2491%.
     YUAN: The yuan depreciated to 6.9181 against the U.S. dollar from Tuesday's
close of 6.9141. The PBOC set the yuan central parity rate stronger at 6.9065 on
Wednesday, compared with Tuesday's 6.9075.
     BONDS: The yield on the benchmark 10-year China Government Bond was last at
3.4850, down from the closing price of 3.5100% on Tuesday, according to Wind
     STOCKS: The benchmark Shanghai Composite Index closed 0.68% lower at
2,641.34. Hong Kong's Hang Seng Index increased 0.10% to 26,147.69.
     FROM THE PRESS: China is expected to implement a new round of tax cuts and
fee reductions by the end of this year, the Economic Information Daily said on
Wednesday. The tax cuts will focus value-added tax and income tax, said the
newspaper, citing Yang Zhiyong, director of the fiscal research office at the
Chinese Academy of Social Sciences. Small and micro companies and technology
start-ups are expected to receive tax exemptions, the newspaper said. (Link to
the story:
     The launch of a new trading board for technology firms seeking share public
offerings may ease financing difficulties for small and medium companies (SMEs),
the Financial News, a newspaper run by the central bank, said in a front-page
commentary on Wednesday. Independent from the existing main board, the new
technology board will boost the presence of tech startups in the capital
markets, the newspaper said. The establishment of the board shows China's
resolve to press ahead with economic transformation, the newspaper said. (Link
to story:
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