MNI China Press Digest, July 8: CPI, Yuan, Covid-19 Cases

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

on Wednesday:

     The Chinese CPI index for June may edge up to 2.6% from 2.4% in May as pork

prices fell and oil prices recovered, Economic Information Daily reported citing

Tao Chuan, an analyst with Soochow Securities. Although the CPI may increase in

June, market participants still believe the index will show a downturn in H2. Li

Chao, the chief economist with Zheshang Securities, told the Daily the CPI will

be lower than 1% Y/Y in Q4 due to historically high pork prices last year, and

due to a slow recovery in demand which would hold down non-food prices. China

will publish the CPI index on Thursday.

     The value of the Chinese yuan will swing at around 7 against the U.S.

dollar in H2 as the Chinese economy continues to recover, according to

Securities Daily. Citing Wang Xin, a researcher with the Research Institute of

the Bank of China, Wang said market confidence has been restored in Hong Kong

and its economic development. Meanwhile, the Chinese economy has posted

marginally improved indicators, attracting foreign capital, and the PBOC has

kept monetary policy stable thus sustaining the interest spread between China

and the U.S. within a secure zone. All of these factors have helped the yuan

strengthen, Wang said.

     Beijing reported no new Covid-19 case for a second day on Tuesday after the

second wave hit the city on June 11. Beijing has reported 335 cases in the

second wave, after new cases were found linked to the city's biggest wholesale

market. The region in which the market is located is the only "high-risk region"

in Beijing and citizens from the rest of the city are allowed to travel without

virus test reports. Beijing has conducted virus tests for more than 11 million

people, about half of the city's population, according to Xinhua News Agency.

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

--MNI Sydney Bureau; +61 405322399; email: lachlan.colquhoun.ext@marketnews.com

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