MNI China Press Digest, March 20: Mon Pol, Interest, Property

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

Tuesday:

     China's monetary policy will become more flexible to ensure abundant, but

not excessive, liquidity, reported China Securities Journal, citing Xu Nuojin,

head of Zhengzhou city division of PBOC. China did not set goals for M2 or

social financing growth this year as it is still reining in financial risks.

Financial institutions should aim to control financial risks and adjust their

expectations for future growth, as their businesses are increasingly included

into the framework of macro-prudential assessment.

     Pressure on PBOC to increase benchmark interest rate is increasing as

global monetary policy normalises and China's inflation climbs, China Securities

Journal reported, citing market insiders. Whether the benchmark interest rate

will be adjusted still depends on China's economic fundamentals. Changes in the

interest rate will have limited impact, as they will likely not be large.

Liquidity is not as tight as last year, and fluctuations in the money market

interest rate are expected to slow.

     Property controls will not be loosened if the establishment and reform of

the long-term property system does not have an impact or if people's

accommodation needs have still not been met, said Economic Information Daily in

a commentary on Tuesday. The central government and local governments are still

diversifying their property policies across different cities to target property

bubbles and rein in high housing prices in some cities. Tier-1 property markets

will continue see tight controls, will likely not see big changes in the short

term. Shanty-town renovation projects, which are set to add 5.8 million housing

units this year, will buoy property investment growth this year. 

***COMMENTS: Diversified property policy will continue into this year. As the

property market is expected to cool further, property controls could be reduced

at the end of this year. 

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

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

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