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MNI China Press Digest August 30: U.S., Yuan, Mortgages


Highlights from Chinese press reports on Wednesday:

  • China and the U.S. should strengthen cooperation, reduce confrontation and jointly promote world economic recovery, according to Premier Li Qiang. At a meeting with U.S. Secretary of Commerce Gina Raimondo, Li said the two countries should embrace win-win cooperation and resist politicising economic issues to avoid damaging the global economy. Raimondo said the U.S. wanted to maintain normal economic and trade relations with China and has no intention of containing the country or decoupling. (Source: China Ministry of Foreign Affairs Website)
  • The yuan may strengthen at the end of the year when the U.S. Federal Reserve is expected to end its rate-hike cycle and domestic company Q4 forex settlements add their support alongside effective implementation of pro-growth policies. The central bank has taken a firm stance against the yuan overshooting, mainly by setting a higher-than-expected central parity rate, as well as the issuance of offshore central bank bills. The timely use of countercyclical factor in central parity rate, forex reserve requirement ratio and window guidance will also help stabilise market expectations, said Zhao Wei, chief economist at Sinolink Securities. (Source: China Securities Journal)
  • Major state-owned banks may move to substantially promote the reduction of existing residential mortgage rates this week, Securities Daily reported citing anonymous sources. So far, Agricultural Bank of China, China Construction Bank, China CITIC Bank and China Merchants Bank have revealed they are preparing for the adjustment. Every 10bp cut in outstanding mortgage rates may lead to a reduction of 0.9-1bp in banks' net interest margin, according to estimates by major research institutes.
MNI Beijing Bureau |
MNI Beijing Bureau |

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