MNI China Press Digest June 21: Fiscal, Bonds, Consumption

Highlights from Chinese press reports on Wednesday:

• China is unlikely to increase the quota of special treasury bonds this year, as structural monetary policy and various measures to promote consumption and investment will have a positive impact on the economy, according to Ming Ming, chief economist at CITIC Securities. Ming said China's policy toolbox remained adequate and therefore the urgency to increase special bonds was not strong. For H2, policy makers will likely make further cuts to the reserve requirement ratio and reduce taxes, he said. (Source: 21st Century Herald)
• Regulators will strengthen bond-issuance rules in China’s interbank-bond market, according to a notice issued by the Association of Interbank Market Dealers. The association said China’s market suffered from market agents underwriting at low prices to gain market share and not following competitive dynamics. The association said issuers should adhere to market principles and must not interfere with pricing or illegally specifying issuance interest rates. Authorities will ensure underwriting institutions remain separate from investment trading to prevent conflicts of interest and will encourage more liquidity in the secondary market of bonds.
• China must embrace policies aimed at restoring and expanding consumption, according to Wang Huning, member of the Standing Committee of the CPC Political Bureau. Speaking at a recent symposium, Wang said China’s society must understand consumption was key to modernisation and achieving high-quality development and the Government should carefully study how to increase consumption. At the symposium, leaders from The All China Federation of Industry and Commerce suggested boosting the role of private enterprises was key to restoring and expanding consumption (Source: Xinhua).