MNI China Press Digest July 31: Trade, Yuan, Property

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

Tuesday:

     Countries that pursues unilateralism will be isolated, because trade

liberalization is a consensus shared by the international community, said Wang

Yi, Chinese Foreign Minister, at a meeting with his British counterpart,

according to a statement on Ministry of Foreign Affairs (MOFA) website. The U.S.

has benefitted from China's trade surplus as 60% of the surplus were made by

foreign enterprises in China, Wang added. China welcomes dialogues and

negotiations with the U.S., though talks should be conducted on the basis of

equality and respect, Wang noted, according to MOFA.

     The yuan may continue to depreciate and test 6.9 this week, as the PBOC may

be inclined to let the market set the prices, China Securities Journal reported,

citing unidentified market participants. China's relatively small size of forex

reserve, strong U.S. economy and the euro zone's dovish monetary policy may

result in a strong U.S. dollar and downward pressure on the yuan in the third

quarter, the newspaper said citing a research report by Ming Ming, chief

economist of Citic Securities. China should reintroduce the countercyclical

factor in the pricing mechanism of central parity rate to secure the bottom of

the exchange rate and prevent the extent of the depreciation, the newspaper said

citing Ming.

     China should monitor the excessive housing price increases in tier-3/4

cities, Xinhua News Agency said in a commentary. Last month, property prices in

several tier-3 cities gained over 9.0% y/y, Xinhua said citing official data.

The continuous outflow of population in the smaller cities doesn't support the

rising prices of residential properties, Xinhua said, citing people it didn't

identify. Local government's regulations should prevent speculative investment

and improve effective housing supply, Xinhua added.

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

--MNI Beijing Bureau; +86 10 8532 5998; email: william.bi@mni-news.com

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