MNI China Press Digest July 11: Yuan, MonPol, SOAs

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

Wednesday:

     Although the yuan has seen increasing two-way fluctuations against the U.S.

dollar, it is basically stable against a basket of currencies, maintaining the

balance of international capital flows, reported Financial News, an official

PBOC publication, citing experts. China's economic fundamentals will support

stable FX reserves; the yuan will also be more flexible, said the newspaper. The

yuan has been more favored as a payment currency and reserve currency, with

three consecutive quarters of increases in the proportion of the world's forex

reserve, according to the data of IMF.

     In consideration of the combination of fiscal policy and monetary policy,

monetary policy should not be tightened anymore, reported China Securities

Journal, citing Sheng Songcheng, head of the Financial Survey and Statistics

Department under the People's Bank of China (PBOC). With the marginal easing of

deleveraging, the growth of M2 this year will likely exceed 8.5%, higher than

8.1% last year, Sheng said. This year's fiscal policy has been tighter than last

year, as shown in this year's expected 2.6% deficit ratio, 0.4% lower than last

year, Sheng said, according to the Daily.

     China will enhance the management of state-owned financial asset, marking a

shift from enterprise management to asset management, reported Economic

Information Daily. In doing so, China will enhance the strategic layout of

state-owned financial asset and boost the vitality of financial institutions,

said the newspaper. China will push the legalization of financial regulation to

achieve high quality development. In order to serve the real economy, Chin will

lead state-owned financial asset into key industries, infrastructures and

financial institutions, said the newspaper.

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

--MNI Singapore Bureau; +65 8233 2326; email: Asia-Editor@marketnews.com

[TOPICS: M$A$$$,M$Q$$$,MBQ$$$]