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MNI (Sydney)

The following lists highlights from Chinese press reports on Wednesday:

  • The yuan's recent fall against the dollar is a normal and healthy recalibration and has eased the pressure on companies that receive revenue in dollars, Guan Tao, a former official at China's State Administration of Foreign Exchange, wrote in a commentary in the Economic Daily. The recent Chinese yuan depreciation was driven by risk aversion as the pandemic regained momentum in Europe and inflation expectations rose in the U.S., which narrowed interest rate spreads with China, Guan wrote. The weakening yuan also resulted from greater expectations for the U.S. recovery due to the fast rate of vaccination and concerns about tightening policies, Guan wrote.
  • The People's Bank of China may refrain from monetary easing and any changes to reserve-deposit ratios or interest rates given expectations of a mild increase in consumer prices, the China Securities Journal commented. Overall inflation may remain benign given the slow growth in infrastructure investment and because real estate development has been strictly regulated, the Journal said. The market expects the CPI will post a positive increase from 0.3% to 0.5%, MNI noted. Policy advisors have previously told MNI that CPI may average 2% throughout 2021. China will publish March CPI on Friday.
  • China will not be coerced by the possible threat of a a U.S.-dominated semiconductor supply chain, according to the Global Times. Commenting in response to the Biden administration's intention to strengthen U.S. chip production, the newspaper said the move raises concerns of a "chip war" in which the U.S. will use its "hegemony" to crack down on Chinese companies. While it may take China a long time to develop its own cutting-edge semiconductor supply chain, the fact that it is the largest market for the global semiconductor industry will allow China to develop the technologies and pursue cooperation with global players, the Times said.
MNI Sydney Bureau | +61-405-322-399 |
MNI Sydney Bureau | +61-405-322-399 |