MNI China Press Digest, Feb 20: PBOC, RRR Cuts, Bonds

     BEIJING (MNI) - The following lists highlights from Wednesday's China

press:

     The People's Bank of China (PBOC) will carry out the first phase of Central

Bank Bill Swap (CBS) today, with a total volume of CNY1.5 billion, the PBOC

said. The swaps aim to support banks replenish capital via issuance of perpetual

bonds. The bond code of the central bank bill exchange is 1901001S and the

coupon rate is 2.45%, maturity one-year. The bidding is open to primary dealers

in the open market at a rate of 0.25%, according to a statement on the PBOC

website.

     The PBOC still has room to lower the reserve requirement ratio, and this

will help to support the real economy by underpinning balance sheets, while any

impact from interest rate cuts may be limited and policymakers should be

cautious using them, the Economic Information Daily said, citing Lian Ping,

chief economist at the Bank of Communications.

     February local government bond issuance kicks off today, with the total

expected to reach CNY295.86 billion, Securities Daily said. The sales will

support construction of on-going infrastructure projects, play an important role

in stabilizing investment and boosting consumption, and relive short-term growth

pressure, the Daily said citing analysts. The amount issued in January was

CNY417.97 billion, the newspaper said.

     China's State Council issued guidance to boost the agricultural sector late

Tuesday, including a soybean revitalization plan which will expand planting

areas of soybean in many ways. The government also plans to improve the quality

of baby formula, and develop green and high-quality food, a document published

on the government website said.

--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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