MNI China Press Digest, May 13: Sino-U.S., RRR Cut

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

Monday:

     Fluctuations in Sino-U.S. economic and trade relations have a limited

impact on the Chinese economy because domestic demand has become the main driver

of economic growth, according to the People's Daily in a front page commentary

today. The paper said that consumption had contributed 76.2% to China's growth

last year. The impact of the trade frictions is generally controllable, the

daily added.

     U.S. domestic retailers, manufacturers and consumers have borne 90% of the

additional tariffs that the U.S government has put on Chinese exports since

August 2018, Xinhua News Agency reported today citing research by the Institute

of World Economics and Politics, CASS. The Xinhua report also quoted a MOFCOM

think tank which claimed that in the latest tariff hikes covering a total of

6081 items valued at $200 billion, there are 1150 items for which the U.S.

relies on China for more than 50% of its imports. Only 124 of the items for

which Chinese exports to the U.S. account for more than 50% of total exports.

The Xinhua report said the U.S. is more reliant on Chinese goods and raising

tariffs will push domestic U.S. prices higher.

     The PBOC is more likely to lower the reserve requirement ratio for

medium-sized commercial banks if it is to use RRR cut to hedge internal and

external risks in the future, said Ming Ming, chief analyst at CITIC Securities

in a report published today. Faced with increasing uncertainty, monetary policy

is unlikely to be loosened significantly but there is room for targeted and

marginal loosening, Ming said.

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

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

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