MNI China Press Digest, Oct. 8: Yuan, Fiscal Policy, Slowing

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

Monday:

     The yuan exchange rate will rebound once its rate formation system is

stabilised, and thus current fluctuations can be ignored, said Liu Shijin, a

member of the Monetary Policy Committee at the PBOC, in his article published on

Economic Daily. Fluctuations of the yuan should not be exaggerated, as two-way

fluctuations are more obvious and expectations for the depreciation of the yuan

have weakened, Liu said. China's strong fundamentals are capable of keeping the

yuan stable and at a reasonable and balanced level, Liu noted. The key is to

continue to let the market play a bigger role in FX and to enhance flexibility

of the yuan, while knowing fluctuations are normal, he said.

     China will further expand domestic demand and adjust its economic structure

by implementing a more active fiscal policy, China's Finance Minister Liu Kun

said, according to the People's Daily. China will cut tax for companies, use

fiscal revenue to support important infrastructure projects, facilitate

consumption, and improve people's livelihoods, Liu said. The Ministry of Finance

has decided to aid companies facing problems during the trade war with the U.S.

The Chinese government will support these companies by allowing affected

employees in certain companies to transfer to other jobs or to receive training,

Liu said. The fiscal policy should be flexible and adapt to actual situations in

order to better serve the real economy, Liu said.

     The growth in Chinese tourism travel revenue during the Mid-autumn Festival

holiday and the National Day holiday has slowed to a ten-year low, WallStreet CN

reported, citing Citic Securities. Some 726 million Chinese individuals

travelled domestically during the two holidays, a 9.4% y/y growth, compared with

growths of 12.0% in 2017 and 12.8% in 2016, according to the analysts, citing

data from the Ministry of Cultural and Tourism. Revenue of domestic travel grew

9.0% y/y to CNY599.08 billion, lower than the 14.0% and 14.4% gains in 2017 and

2016 respectively, the analysts said. While official overseas travel data were

not offered, outbound tourism of Shanghai and Beijing customs -- which comprises

half of China's outbound travel -- dropped, the analysts said. The drops were

due to a bottlenecking of tourism facilities, as well as the fact that the

Mid-autumn Festival and National Day holidays this year were separated by a

six-day gap. It possibly also reflects slowing consumption during an economic

slowdown, Citic Securities said.

--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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