MNI China Press Digest Mar 3: RRRs, Policy Focus, High Income

The following lists highlights from Chinese press reports on Wednesday:

• The PBOC is likely to cut reserve requirement ratios this month for those banks which have met certain levels of lending to SMEs, the China Securities Journal reported citing analysts. Some city and rural commercial banks will benefit from an estimated CNY120 billion which could be released by the cuts, the newspaper said citing Li Yishuang, chief fixed income analyst at Cinda Securities. The PBOC previously conducted such targeted RRR cuts in January 2019 and March 2020, releasing CNY250 and CNY400 billion respectively, the newspaper said.
• The PBOC is likely to shift the focus of monetary policy towards containing macro leverage ratios this year in a departure from last year's priority of reducing business financing costs, according to an article in the 21st Century Business Herald. The government may align M2 and social financing growth with nominal GDP, the newspaper said citing Shao Yu, chief economist of Orient Securities. The central bank may keep policy rates or reserve ratios unchanged unless growth deviates from the targeted range, and adjust liquidity mainly by open market operations, Shao said.
• China's 2021-2025 development plan may seek to boost per capita national income to over USD14,000 by 2025 with more than 560 million mid-income earners and annual growth at around 5%, the Securities Daily said in a front-page commentary in a preview of the National People's Congress starting March 5. The key medium-term policy paper should focus on optimizing economic structures, improving quality and efficiency and setting feasible long-term targets, the newspaper added.