MNI China Daily Summary: Thursday, Nov 27

EXCLUSIVE: The Chinese yuan is expected to strengthen further and move below the 7.0 mark in the first half of 2026 after breaking through the key 7.10 level against the U.S. dollar on Tuesday, while the People’s Bank of China will maintain flexibility to prevent any sharp appreciation from hurting exports, policy advisers and traders told MNI.

EXCLUSIVE: China’s banks will accelerate the disposal of foreclosed property to free up capital and hedge risks from further house-price declines, which will continue to pressure property-backed loans, economists and analysts told MNI, noting lenders are set to cut real estate-related lending and pursue further consolidation to contain risks.

POLICY: China's National Development and Reform Commission is promoting the expansion of infrastructure REITs to more sectors and asset types, while supporting more eligible projects to list and trade on stock exchanges, NDRC Spokesman Li Chao told a press conference.

POLICY: China’s latest action plan to boost consumption through structural supply-side reforms will stimulate the multiplier effect of the nation's vast domestic market, generating trillions of yuan in new consumer markets by 2027, according to Xie Yuansheng, vice minister of the Ministry of Industry and Information Technology, speaking at a press conference. 

LIQUIDITY: The People's Bank of China (PBOC) conducted CNY356.4 billion via 7-day reverse repos, with the rate unchanged at 1.40%. The operation led to a net injection of CNY56.4 billion after offsetting maturities of CNY300 billion today, according to Wind Information

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) fell to 1.4464% from 1.4744% previously, Wind Information showed. The overnight repo average decreased to 1.3114% from the previous 1.3127%. 

YUAN: The currency weakened to 7.0806 against the dollar from the previous 7.0802. The PBOC set the dollar-yuan central parity rate lower at 7.0779, compared with 7.0796 set on Wednesday. The fixing was estimated at 7.0734 by Bloomberg survey today.

BONDS: The yield on 10-year China Government Bonds was last at 1.8200%, up from the previous close of 1.8043%, according to Wind Information.

STOCKS: The Shanghai Composite Index rose 0.29% to 3,875.26, while the CSI300 index decreased 0.05% to 4,515.40. The Hang Seng Index rallied 0.07% to 25,945.93.

FROM THE PRESS: Profits of high-tech manufacturing enterprises rose 8.0% y/y in the first 10 months of the year, 6.1 percentage points higher than the average growth rate of all industrial enterprises above designated size, the 21st Century Business Herald reported, citing data from the National Bureau of Statistics. Profits in intelligent unmanned aerial vehicle manufacturing and intelligent vehicle equipment manufacturing surged 116.1% and 114.9%, respectively, the newspaper said. In October, industrial profits fell 5.5% y/y, reversing September’s 21.6% growth, mainly due to a higher base in the same period last year and a faster rise in financial expenses, the NBS said.

China aims to form three trillion-yuan-level consumption sectors and 10 hundred-billion-yuan-level consumption hotspots and create a batch of high-quality consumer goods with global renown by 2027, according to a plan jointly released by six departments. The plan, focused on addressing the supply-demand mismatch by providing systematic policy support, stated the contribution of consumption to economic growth will steadily increase by 2030. Intelligent connected new energy vehicles, smart homes, and consumer electronics are the key focuses. (Source: Shanghai Securities News)

China hopes the EU will play a constructive role by urging the Dutch government to propose a workable solution to the Nexperia issue as soon as possible and create favourable conditions for the company to conduct internal consultations, Chinese Commerce Minister Wang Wentao said during a video conference with his EU counterpart on Wednesday. Wang said the Netherlands’ recent decision to suspend its administrative order marked a small step toward resolving the issue, but that improper administrative and judicial intervention against the company has yet to be lifted. European Commissioner for Trade and Economic Security Maros Sefcovic said the EU is willing to work with China to ease tensions further and push the situation toward stabilisation. (Source: Ministry of Commerce website)