MNI China Daily Summary: Monday, June 23

POLICY: China’s total installed power generation capacity reached 3.61 billion kilowatts by the end of May, up 18.8% y/y, with power grid investment at CNY204 billion, up 19.8% y/y, the country's National Energy Administration announced.

POLICY: China must enhance the targeting of consumer subsidies, strengthen support for exporters, and step up efforts to stabilise the property market in the second half of the year, according to a report by the China Macroeconomy Forum.

LIQUIDITY: The PBOC conducted CNY220.5 billion via 7-day reverse repos, with the rate unchanged at 1.40%. The operation led to a net drain of CNY21.5 billion after offsetting the maturity of CNY242 reverse repo today, according to Wind Information.

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) rose to 1.5075% from 1.4941%, Wind Information showed. The overnight repo average decreased to 1.3704% from 1.3742%.

YUAN: The currency weakened to 7.1858 against the dollar from 7.1837 on Friday. The PBOC set the dollar-yuan central parity rate higher at 7.1710, compared with 7.1695 set on Friday. The fixing was estimated at 7.1938 by Bloomberg survey today.

BONDS: The yield on 10-year China Government Bonds was last at 1.6000%, up from the previous close of 1.5950%, according to chinamoney.com.cn.

STOCKS: The Shanghai Composite Index gained 0.65% to 3,381.58 while the CSI300 index increased 0.29% to 3,857.90. The Hang Seng Index edged up 0.67% to 23,689.13.

FROM THE PRESS: China should boost services consumption through promoting better supervision and consumer rights, as buyer confidence was undermined by increased disputes in culture and tourism, housekeeping, elderly care and education training sectors, said Economic Daily in a commentary. As a main economic driver, the growth rate of services consumption exceeded goods sales last year and during the first five months of 2025, the newspaper said. Service industry added value accounted for 54% of GDP on average in the past decade, versus over 60% in developed countries, demonstrating China’s potential as the world’s largest middle-income population, the newspaper said.

Mainland and Hong Kong monetary authorities on Sunday launched a new connect programme to facilitate cross-border payments, the People’s Daily reported. The project connects the mainland’s Internet Banking Payment System and Hong Kong’s Faster Payment System (FPS), allowing for more convenient payment and money wire services. The scheme aims to quicken current account remittance services in yuan and Hong Kong dollars, mainly for residents’ salary, tuition fee and medical payments, the newspaper said.

The Beijing Municipal Finance Bureau will allocate special purpose bonds (SPB) towards government investment guidance funds for the first time nationwide, Yicai.com reported. Previously, authorities were permitted to use such funds for direct government investment projects only, according to Hu Hengsong, vice general manager at Caitong Securities, adding that the move allowed better leveraging of fiscal funds and supported local industrial upgrading. Traditional SPB projects often faced delays leading to idle capital, whereas guidance funds allow for market-driven investments and improved capital efficiency, Hu added. Professor Wen Laicheng from the Central University of Finance and Economics, said government guidance funds invest broadly and include high-risk early-stage projects, promoting industrial transformation and innovation.