MNI China Press Digest Mar 30: PBOC Easing, Home Sales, Covid

The following lists highlights from Chinese press reports on Wednesday:

• The People’s Bank of China may still stick to its own easing policy to support growth despite China's sovereign bonds losing yield advantage over its U.S. counterpart, the China Securities Journal reported citing analysts. However, the PBOC is now more likely to ease through RRR cuts or other structural adjustments, while the expectation for a rate cut has cooled, the newspaper said. The spread between yield on China's 10-year bonds and yield on U.S. 10-year Treasury note narrowed to about 30 bps from more than 100 bps in early March, the newspaper said. However, given China's lower inflation and high trade surplus, the narrowing spread may not cause significant depreciation of the yuan or capital outflow, the newspaper said.
• Home sales in China's larger cities saw a more obvious increase from last month, with the figure in four first-tier cities rising by 12% in March from February, showing some signs of stabilization following the relaxation on mortgage loans, the China Securities Journal reported. However, housing markets in smaller cities still face sharp declines from the same period last year, the newspaper said. On the whole, the market remains muted as home buyers lack confidence and the repeated epidemics have further dragged down the pace of recovery, the newspaper said citing Chen Wenjing, an analyst at China Index Academy.
• China is unlikely to have any prolonged period with zero covid cases due to the highly contagious variant that it is battling and the widespread infections within the country, the government-run Global Times said citing an unidentified expert from the Chinese Center for Disease Control and Prevention (CDC). China should find new ways to cope with large-scale outbreaks, the newspaper said citing Zeng Guang, a former chief epidemiologist of the Chinese CDC.