MNI China Press Digest Oct 28: Yuan, GDP, Liquidity, Sino-U.S.

The following lists highlights from Chinese press reports on Wednesday:

China has gradually eased the use of countercyclical factors in some of its recent daily fixing against the dollar to increase transparency and efficiency and allow the market a bigger role, the Economic Information Daily reported citing the Secretariat of the China Foreign Exchange Self-Regulatory Mechanism. The move has corresponded to the recent gains in corporate settlement and decreases in sales exchange rates and wider foreign exchange movements, the Daily cited Wang Youxin, a researcher from the BOC Research Institute. The yuan should remain strong given current economic fundamentals and China's interest spreads against those of other nations, but uncertainties exist in Q4 given a possible second recession and financial market volatilities in Europe and America, and the unknown regulatory intentions of Chinese regulators, Wang said.

China is likely to de-emphasise the GDP growth rate while mapping out its 14th Five-year Plan and pursue the "dual circulation" model as it continues to open up the economy, Yicai reported. China will focus more on economic balance and high quality development rather than a specific GDP growth goal, the newspaper said citing Wang Tao, an economist from UBS Securities. China's future GDP increase should rely more on domestic demand and consumption potential, YiCai reported citing comments by CICC. The opening up of capital accounts and capital movement will stoke external demand, YiCai said.

China's tight inter-bank liquidity is seen easing next month as less government bonds are on offer and tax remissions fall, the Shanghai Securities News reported citing Ming Ming, analyst at CITIC Securities. About CNY550 billion in China Government Bonds and CNY400 billion in local debt will be issued in November, Ming said. Fiscal disbursements may accelerate in November, adding CNY210 billion in liquidity while revenue is likely to dip on seasonal trends, which puts less pressure on tax remission, Ming said.

U.S. politicians who smear China, including creating the so-called China Working Group, are blatantly intervening in Chinese internal affairs, the People's Daily said in an editorial. Actions such as this, the Daily said, attempt to subvert foreign regimes as a tool of policy, and will pose a threat to global politics. Peaceful development and mutual cooperation are the only way forward, as past history has shown that the U.S. has exported war under the cover of humanitarianism and this had made it a destructive force, the Daily said. The U.S. obsession with hegemony and bullying must be stopped, said the newspaper.