MNI China Press Digest Jan 9: Yuan, FX Reserves, Covid-19

Highlights from Chinese press reports on Monday:

• Overseas capital flows will continue to rebound and the yuan will continue to strengthen in 2023, according to Guo Shuqing, Secretary of the Party Committee of the People's Bank of China (the PBOC) and Chairman of the Banking and Insurance Regulatory Commission. In an interview, he said these upward trends show the international finance community is optimistic about China’s growth outlook and strong economic fundamentals, such as stable inflation. Beijing should remain vigilant on price stability, as overseas inflation can be transmitted to China through multiple channels, he said. Additionally, the pace of financial opening would not stop and China would simplify procedures for foreign investors to enter the domestic market. Guo’s comments were reported by the Securities Daily Network.
• China’s foreign exchange reserves will remain stable in 2023 despite weakening in the world economy and volatile international financial markets, according to Guan Tao, a former official at the State Administration of Foreign Exchange. In an interview with Financial News, he said China’s strong long term fundamentals together with the PBOC’s non-intervention policy in the FX market was conducive to maintaining overall stability in foreign exchange reserves, which remained above USD3 trillion throughout 2022. The paper also cited analysts that expect China to maintain a stable balance of payments amid a continuing current account surplus, and improvements in the capital and financial accounts.
• The rate of Covid-19 cases in big cities has peaked, with the rate of people requiring emergency care showing signs of decline, and those needing intensive care plateauing, according to Jiao Yahui, Director of the Department of Medical Administration of the National Health Commission. For small and medium size cities, infections are now peaking, meaning cases requiring emergency treatment will be at their highest during the Spring Festival. Jiao’s comments were reported by CCTV News.