MNI China Press Digest July 5: Deleveraging, PBOC, Consumption

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

Thursday:

     As China's economy focuses more on high quality development than on a high

growth rate, the leverage ratio will naturally decrease, Economic Daily

reported, citing Liu Shijin, member of the Monetary Policy Committee of the

PBOC. The country's deleveraging campaign has achieved some preliminary results

as the leverage ratio stabilizes, Liu noted. The leverage structure is also

optimizing, with a lower leverage ratio for the business sector and in the

asset-liability ratio of state-owned enterprises, Liu added.

     The PBOC's monetary policy this year has balanced liquidity and structural

support, both maintaining the liquidity at reasonable and sufficient levels and

leading financial resources to small and micro enterprises, said Financial News,

an official publication of the PBOC, in a commentary. The PBOC released

liquidity of CNY2.8 trillion in the first six months of 2018, far exceeding a

total of CNY1.76 trillion released in the whole of last year, the newspaper

noted. The bond market is stabilizing, while appropriate bond defaults will help

the market mature and develop healthily in the long term, the commentary said.

     Consumption growth is expected to rise slightly in the second half of the

year, contributing over 60% of the overall economic growth this year, Shanghai

Securities News reported, citing Lian Ping, chief economist of Bank of

Communications. Further opening-up, an expansion in imports as well as

individual income tax reforms will have positive impacts on consumption, Lian

added. With the increase of industrial profit and a cut in manufacturing taxes,

manufacturing investment should accelerate in the second half of the year,

marking an annual growth at about 6%, Lian predicted.

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

--MNI Beijing Bureau; +86-10-8532-5998; email: beijing@marketnews.com

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