MNI CHINA MARKETS: Yuan Weaker; Rates Higher; Shares Down

     BEIJING (MNI) - The Chinese yuan fell to to 6.3295 against the U.S. dollar

on Wednesday from yesterday's 6.3064 closing, following today's weaker fixing.  

     PBOC set the yuan central parity rate vs the U.S. dollar at 6.3294 on

Wednesday, weaker than Tuesday's 6.3146. PBOC has set the fixing weaker for a

first day after three stronger fixings.

***COMMENTS: Today's yuan fixing saw the biggest drop since Feb. 14. It came

less than a day after new U.S. Fed Chair Jerome Powell signaled a hawkish stance

at his first congressional testimony, which boosted the dollar. In the short

term, the dollar is very likely to rebound from its recent low. As FX demand

rises, yuan may return to better reflect China's economy.

     Interbank market rates edged up after PBOC chose not to conduct open-market

operations, which resulted no change in liquidity conditions: Wind Information.

  - 7-day repo average rose to 3.0005% from the 2.8984% yesterday 

  - Overnight repo average increased to 2.6992%, compared with 2.5426%

yesterday. 

     Yield on 10-year sovereign China Government Bond last traded 3.8300%, down

from 3.8375% close yesterday: Wind Information.

The Shanghai Composite Index lost 0.92% to 3261.72 at 11:05 am, while Hong

Kong's Hang Seng Index was last at 30,915.89, down 1.13%.

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

--MNI Beijing Bureau; +86-10-8532-5998; email: beijing@marketnews.com

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

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