MNI CHINA MARKETS: Yuan Weakens; Rates Down; Stocks Up

     BEIJING (MNI) - The yuan weakened against the U.S. dollar on Wednesday

morning as the U.S. dollar index picked up.

     The yuan was last at 6.5077 against the U.S. unit, weaker than the official

closing price of 6.4967 on Tuesday. The currency rose as high as 6.4960 this

morning, the strongest since Sept. 8, 2017. 

     The dollar index strengthened 0.11% in the morning to 91.95. 

     The People's Bank of China set the yuan central parity rate against the

U.S. dollar at 6.4920, stronger than Tuesday's 6.5079. The PBOC has set the

fixing stronger for nine of the past 11 trading days, with the yuan rising 1.89%

over that period. Today's fixing marks the strongest parity since May 3, 2016.

     Money market rates were down in the interbank market after the PBOC on

Friday announced a temporary targeted reserve requirement ratio cut in a bid to

hedge the liquidity gap during Chinese New Year. The seven-day repo average was

last at 2.6979%, lower than Tuesday's average of 2.7655%. The overnight repo

average was at 2.5216%, also lower than Tuesday's 2.5891%. 

     The yield on benchmark 10-year China government bonds was last at 3.9150,

up from the previous close of 3.9000%, according to Wind, a financial data

provider. 

     Mainland stocks were up, led higher by the property and financial sectors

in the morning session. The benchmark Shanghai Composite Index was up 0.77% at

3,374.01. Hong Kong's Hang Seng Index was 0.22% higher at 30,581.73

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

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

[TOPICS: M$A$$$,M$Q$$$,M$$FI$,MN$FI$,MN$FX$]