MNI China Press Digest, Oct. 26: PBOC, Yuan, Insurance Funds

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

Friday:

     Reverse repos have become the norm for the PBOC's open market operation

this year, but it does not mean that the prudent and neutral monetary policy has

changed, and there is unlikely to be a large scale easing in the future, the

Financial News, known as the central bank's mouthpiece, said Friday. The PBOC

has injected a net CNY520 billion via reverse repo over five consecutive days,

which, along with other tools like refinancing and rediscount, is expected to

offset any short-term tighter liquidity conditions due to the October tax

period, the newspaper said. (Link to the story: https://bit.ly/2SkqZqf)

     The yuan is unlikely to break the key mark 7 in the short term, as the U.S.

dollar is unlikely to appreciate sharply, the Securities Daily said Friday

quoting analysts. The U.S. dollar index remains at a strong level, which

inevitably exerts some downward pressure on yuan. However, considering that

China's economy is still growing at a steady pace, the fundamentals do not

support a continued sharp depreciation of yuan, said Wang Qing, chief analyst at

a credit rating agency Dongfang Jincheng. The yuan closed at 6.9498 against the

U.S. dollar on Thursday, the highest point since January 3, 2017. (Link to the

story: https://bit.ly/2D5ndwI)

     China Banking and Insurance Regulatory Commission has given the green light

to insurance firms to set up special products that can help resolve 'equity

pledge' risks and ease the liquidity crisis for listed companies, the Economic

Information Daily reported Friday. The Commission had limited the investment

scope of such special products, mainly including stocks of listed companies,

bonds issued by listed companies and their shareholders, and non-publicly issued

exchangeable bonds, the Daily said. (Link to the story: https://bit.ly/2JiyXfN)

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

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: M$A$$$,M$Q$$$,MBQ$$$]