MNI China Press Digest, Aug 30: Bond Market, Trade, Tax Cuts

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

Thursday:

     Bond yields are expected to remain stable, as the impact of local

government bond issuance on the market is limited and temporary, and as money

supply is still ample, China Securities Journal reported. With a looser monetary

policy bringing more liquidity to the Chinese market, the U.S. Fed expected to

increase its interest rate, and the yuan still facing downward pressure,

investors should pay attention to economic data in August, said The Journal. It

will take time for this looser monetary policy to eventually affect economic

data -- the bond market may be affected by varying investor sentiment and may

experience fluctuations in Q3, and it will see clearer trends in Q4.

     Bank of China will give around USD100 billion in credit to Chinese

companies involved in trade, said head of the bank Liu Liange, according to

Tencent News. An important task of the bank is diversifying China's foreign

trade, including providing an international trade settlement service worth more

than USD650 billion, Liu said. The bank will help Chinese companies optimise

their efforts in global market expansion, especially across ASEAN, central and

eastern Europe, Africa and Latin America, according to Liu.

     China will further cut taxes for Chinese companies, reported Economic

Information Daily, a newspaper of the official Xinhua News Agency. China's

proactive fiscal policy will focus on reducing tax for certain groups,

particularly micro-businesses and innovative companies, the newspaper said,

citing government researchers and experts. Tax reduction for micro-businesses

and start-ups could enhance companies' return on investment, thus enhancing

innovation in the country, said Li Wanfu, director of the Tax Sciences Research

Institute under State Administration of Taxation. China will implement other tax

reduction policies to reach its goal of cutting tax by at least CNY1.1 trillion

this year, the newspaper said.

--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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