MNI China Press Digest June 2: Infrastructure, Outflow, Energy

The following lists highlights from Chinese press reports on Thursday:

• China will increase financial support to boost infrastructure construction by adding a CNY800 billion credit quota for policy banks and matching funds with key projects, according to a statement on the government website citing a State Council executive meeting late Wednesday. The meeting chaired by Premier Li said that the newly added quota of CNY140 billion in tax rebates should be basically refunded by end-July, according to the statement. The State Council also urged officials to help unemployed migrant workers, and people whose jobs and income have been affected by the epidemic, the statement said.
• The net outflows from the Chinese bond market may decelerate, likely less than CNY100 billion per month in May and June, as short-term investors have priced in the inversion of China-U.S. government-bond yield and yuan tend to stabilize in the coming months, Yicai.com reported citing Liu Linan, managing director of Deutsche Bank. The U.S. 10-year Treasury bond yield may rise to 3.3% in Q3 while that of 10-year China Government Bond may fluctuate between 2.7-3%, Liu was cited as saying. There is no need to worry about yuan, as it is traded at the midpoint of the fluctuation range in the past four years, reflecting rational market sentiment, Liu was cited as saying.
• China plans to double its wind and solar power generation by 2025, with renewable energy generating about 3.3 trillion kWh annually, the Shanghai Securities News reported citing the 14th Five-Year Plan for Renewable Energy Development released Wednesday. Current available funds with low interest rates are far from enough, while the government is expected to further increase support for green bonds and green credits for eligible new energy projects, the newspaper said.