MNI China Press Digest, Aug 28: Yuan, Property Policy

     BEIJING (MNI) - The following lists highlights from the Chinese press for

Tuesday:

     Chances of the yuan exchange rate dropping to the 7.0000 level are

decreasing, as policy makers approach their "bottom line", China Securities

Journal reported, indicating 7.0000 is the PBOC's bottom line for the yuan

exchange rate against the dollar. The yuan's appreciation against the dollar

this round was due to the dollar's depreciation and macro-controls of the

Chinese government, particularly the reintroduction of the counter-cyclical

factor. If the yuan further weakens, the PBOC's "macro-prudential management"

will likely increase, the newspaper said, indicating that the PBOC would issue

policies to prevent the yuan from dropping below 7.0000.

     Hohhot City, the capital city of Inner Mongolia, announced it would stop

measures that encouraged reducing property inventory, China Business News

reported. The move aims to control housing prices and stabilise the property

market, the newspaper said, citing the property regulator of Hohhot. The city

would increase supply of property land and units, and would clamp down on

illegal practices of property developers, the regulator said. 

**COMMENTS: Hohhot is the first city in China to stop its inventory reduction

campaign. This could signal similar action in other parts of the country, thus

affecting property investment.

     Heavy use of finance and capital in the property rental market causes

risks, for which authorities should increase regulations, Economic Daily

reported. Dingjia, a long-term apartment operator, announced its bankruptcy last

week, causing around 4,000 renters to suffer monetary losses. This bankruptcy

exposed housing agents and online lending platforms colluding to make tenants

take out loans unknowingly, while Dingjia used both whole-year rent and loans

from lending platforms for its expansion. Some property companies and apartment

operators engage in various illegal practices, such as bidding up renting

prices, which increases risks for the sector, the newspaper said, citing experts

calling for tighter policy controls on the sector.

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

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

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