MNI China Press Digest, Sept 27: OMO, Tariff Cuts, A-shares

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

Thursday:

     The PBOC is unlikely to increase the open market operation interest rate

after the U.S. Fed increases its benchmark interest rate, China Securities Daily

said. "Liquidity in the banking system is at a relatively high level," according

to the PBOC on Wednesday, which means there is no need to continue to inject

liquidity this week, leaving no room for OMO interest rate adjustments. High

fiscal spending this month, the weakening impact of government bond issuance and

reverse repo maturities also make it unnecessary to conduct OMO injections, the

newspaper said. China and the U.S.'s economic policies cannot be managed at the

same pace, as China's monetary policy currently lacks the foundation to be

changed and as the gap between China's OMO rate and market interest rate is very

small, the Journal said.

     Chinese Premier Li Keqiang announced that China will cut tariffs for 1585

products from Nov 1 and increase support for foreign investors, according to the

Xinhua News Agency. China should implement "more active" opening up strategies,

Li stressed, while expanding domestic demand amid the current "complicated"

domestic and international environment. China will reduce duties of certain

machines in high demand to 8.8% from 12.2%, textile and construction materials

to 8.4% from 11.5%, and paper products to 5.4% from 6.6%, Xinhua reported. China

should improve the investment environment for foreign investors, listing

qualified foreign-invested projects in the country's major construction projects

and speeding up approvals for land use and ocean use for these foreign

investors, Li said.

     Some USD66 billion funds will flow into the A-share market if the MSCI Inc.

proposals announced Wednesday are to implemented, Shanghai Securities News

reported, citing Guan Zhengbin, head of the Asia-Pacific research department of

MSCI. MSCI is considering increasing the weight of China's mainland shares in

its global indexes, with the yuan-denominated stocks up to 20% from 5% of the

indexes, the newspaper said. MSCI also proposes the inclusion of ChiNext board

-- in which China's tech companies are heavily listed -- in the indexes from

next year, and mid-cap stocks from 2020, the newspaper said. The MSCI team will

further discuss the decision with clients and will finalise plans by Feb 20 next

year, Xie told the newspaper.

***COMMENTS: FTSE Russell also announced earlier this morning that China's

A-shares will be included in its emerging market indexes, making the China

mainland shares comprise 5.5% of FTSE's emerging index. The process will start

in June next year and end in March 2020. 

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

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

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