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MNI China Press Digest, Aug. 13: Liquidity, Lending, Retail

MNI (Sydney)

The following lists highlights from Chinese press reports on Thursday:

The PBOC's injection of CNY140 billion on Wednesday, the largest in a month, was to ease concerns of tight liquidity due to the surging issuance of local government bonds, the Shanghai Securities News reported. Citing Yan Se, the chief economist with Founder Securities, the report said that because a large proportion of the proceeds from the local bonds would be quickly spent, the shortage would only be short-term. The short-term injection might have also corresponded to market concerns following the release of the smaller-than-expected money supply data on Tuesday, the newspaper said citing chief fixed income analyst Yang Weixiao of Kaiyuan Securities.

China's lending to the manufacturing industry in H1 increased by the equivalent of total increases over the past four years, helping accelerate the recovery, according to Guo Shuqing, the Chairman of China's Banking and Insurance Regulatory Commission, In an interview with state media CCTV, Guo said that over two-thirds of China's SMEs, numbering more than 30 million, can access bank loans, although the central government still prefers that companies obtain more direct financing through bonds and stocks. Direct financing as a share of total capital raising increased to 36% from 32% in H1, Guo said.

China' July retail sales may record the first y/y growth since the pandemic at 2%, as online shopping data improved and cinemas reopened, according to Economic Information Daily citing Tang Weijian, the chief analyst with Bank of Communications. Investment in infrastructure in the first seven months could come in at 1.5% y/y after the government sped up construction projects, the Daily reported citing Lu Zhengwei, the chief analyst with Industrial Securities. The Paper cited Li Chao, an economist from Zheshang Securities, who said the demand side is expected to stabilise with the resumption of work and production. China's July data release is due on Friday.

MNI Sydney Bureau | +61-405-322-399 | lachlan.colquhoun.ext@marketnews.com
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MNI Sydney Bureau | +61-405-322-399 | lachlan.colquhoun.ext@marketnews.com
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