MNI China Press Digest, Dec 17: RRR Cuts, Tax Cuts, Home Price

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

Monday:

     Cutting the Reserve Requirement Ratio(RRR) is no longer at the core of

monetary policy, but a tool to optimize the central bank's policy portfolio, the

Securities Daily said in a commentary Monday. Policymakers are searching for the

optimal policy portfolio with integration between monetary and fiscal policy,

with the aim of directing central bank liquidity into the real economy, the

Daily said. It may be necessary to use RRR cuts as this process unfolds, but it

will only be an auxiliary role and the marginal effect of continuously

conducting RRR cuts will be significantly reduced, the newspaper said.

     The size of China's tax and fee cuts will hit an estimated total CNY1.5 to

2 trillion next year, as the government attempts to keep on the front-foot as

economic headwinds build, China Business News reported late Sunday, citing Shi

Zhengwen, director of the Center for Research in Fiscal and Tax Law of China

University of Political Science and Law. Zhao Quanhou, director of the Financial

Research Center of Chinese Academy of Fiscal Sciences, also predicted that tax

cuts in 2019 could reach CNY1.5 trillion, the report said. VAT, personal income

taxes and social insurance will be the main areas for tax cuts, the report said.

     More cities are expected to see a further fall pre-owned home prices next

year, the China Times reported, citing Zhang Dawei, chief analyst at Centaline

Property Agency. In November, 17 cities saw a decline in pre-owns, which are

believed to better reflect the market price, including four major cities --

Beijing, Shanghai, Guangzhou and Shenzhen, decreasing 0.6%, 0.1%, 0.3% and 0.2%

respectively from October, the newspaper said citing data released by the

National Bureau of Statistics on Saturday. This will be a starting point of the

downward trend, the newspaper said citing Zhang.

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

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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