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MNI China Press Digest Jan 10: Yuan, Prices, Country Garden

MNI picks key stories from today's China press.
Central Bank NewsPolicy NewsPBOCHomepageAPACChinaEM Policy NewsChinaEM Central Bank NewsPeoples Bank of ChinaGlobalStoryRegion

MNI (BEIJING) - Highlights from Chinese press reports on Friday:

  • Market investors should have sufficient reason to believe in the People’s Bank of China’s determination and ability to correct any sharp rises and falls in the exchange rate given the abundant tools it has, said Securities Times in a commentary. The strengthened counter-cyclical factor in its formula for fixing the daily midpoint for the yuan-dollar exchange rate, increased offshore RMB interbank lending rate and the large-scale issuance of offshore central bank bills have all conveyed a clear signal of stabilising the yuan, the newspaper said. Though the PBOC’s goal is not to keep the yuan against the U.S. dollar at a certain level, but to focus on stabilising expectations and smoothing fx settlement and sales, the Times added.
  • China’s CPI is expected to fluctuate with the recovery of domestic demand and food price cycles in 2025, with the median likely being 1%, 21st Century Business Herald reported citing Ming Ming, chief economist of CITIC Securities, after 2024 CPI came in at 0.2% y/y. PPI is also expected to rebound on a yearly basis, following the 2.2% fall in 2024, Ming added. Given Q4’s price performance, the GDP deflator may remain negative for the seventh quarter, signaling great price pressure and necessity for increased countercyclical adjustments, the newspaper said citing Wen Bin, chief economist of China Minsheng Bank.
  • Indebted Chinese developer Country Garden has proposed restructuring terms that aims to reduce its offshore debt by up to USD11.6 billion and extend debt maturity by a maximum of 11.5 years, Yicai.com reported citing the company statement. The restructuring would help reduce the weighted average cost of borrowing from about 6% to about 2% per year. The developer has reached an understanding with a lender group made up of seven banks which holds 48% of the company’s outstanding syndicated loans totalling USD3.6 billion. By end-2023, Country Garden's total overseas interest-bearing liabilities were about USD16.4 billion, the newspaper said.
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MNI (BEIJING) - Highlights from Chinese press reports on Friday:

  • Market investors should have sufficient reason to believe in the People’s Bank of China’s determination and ability to correct any sharp rises and falls in the exchange rate given the abundant tools it has, said Securities Times in a commentary. The strengthened counter-cyclical factor in its formula for fixing the daily midpoint for the yuan-dollar exchange rate, increased offshore RMB interbank lending rate and the large-scale issuance of offshore central bank bills have all conveyed a clear signal of stabilising the yuan, the newspaper said. Though the PBOC’s goal is not to keep the yuan against the U.S. dollar at a certain level, but to focus on stabilising expectations and smoothing fx settlement and sales, the Times added.
  • China’s CPI is expected to fluctuate with the recovery of domestic demand and food price cycles in 2025, with the median likely being 1%, 21st Century Business Herald reported citing Ming Ming, chief economist of CITIC Securities, after 2024 CPI came in at 0.2% y/y. PPI is also expected to rebound on a yearly basis, following the 2.2% fall in 2024, Ming added. Given Q4’s price performance, the GDP deflator may remain negative for the seventh quarter, signaling great price pressure and necessity for increased countercyclical adjustments, the newspaper said citing Wen Bin, chief economist of China Minsheng Bank.
  • Indebted Chinese developer Country Garden has proposed restructuring terms that aims to reduce its offshore debt by up to USD11.6 billion and extend debt maturity by a maximum of 11.5 years, Yicai.com reported citing the company statement. The restructuring would help reduce the weighted average cost of borrowing from about 6% to about 2% per year. The developer has reached an understanding with a lender group made up of seven banks which holds 48% of the company’s outstanding syndicated loans totalling USD3.6 billion. By end-2023, Country Garden's total overseas interest-bearing liabilities were about USD16.4 billion, the newspaper said.