MNI China Daily Summary: Tuesday, June 10

EXCLUSIVE: China is likely to emphasise the need to stabilise manufacturing value-added as a proportion of GDP in its next five-year plan, as it works on an updated version of its “Made in China 2025” campaign to boost high-end output, including semiconductors and artificial intelligence, over the next decade, a policy advisor told MNI.

POLICY: China has extended the deadline of its anti-dumping investigation into EU pork imports by 6 months to December 16, 2025 from June 17, the Ministry of Commerce said on Tuesday.

LIQUIDITY: The PBOC conducted CNY198.6 billion via 7-day reverse repos, with the rate unchanged at 1.40%. The operation led to a net drain of CNY255.9 billion after offsetting the maturity of CNY454.5 reverse repo today, according to Wind Information.

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) fell to 1.5063% from the previous 1.5126%, Wind Information showed. The overnight repo average decreased to 1.3631% from 1.3770%.

YUAN: The currency weakened to 7.1869 against the dollar from the previous 7.1838. The PBOC set the dollar-yuan central parity rate lower at 7.1840, compared with 7.1855 set on Monday. The fixing was estimated at 7.1870 by Bloomberg survey today.

BONDS: The yield on 10-year China Government Bonds was last at 1.6175%, down from the close of 1.6210% previously, according to chinamoney.com.cn.

STOCKS: The Shanghai Composite Index was down 0.44% to 3,384.82, while the CSI300 index decreased 0.51% to 3,865.47. The Hang Seng Index was down 0.08% at 24,162.87.

FROM THE PRESS: Beijing should accelerate issuing ultra-long-term special treasuries and allocate the funds to local governments in a timely manner, after some places reported gaps in consumption subsidies, said an Yicai.com commentary. Of this year's CNY300 billion special treasury support for the consumer goods trade-in scheme, CNY162 billion has already been distributed to provinces. Several local officials are now urging the prompt release of the remaining CNY138 billion, having exhausted their initial allocation.

Xinyang city in Henan is only allowing the sale of completed homes on newly released land, becoming the country's first place to clearly curtail the traditional pre-sale housing model, the China Economic Net has reported. Li Dong, an associate researcher at Tsinghua University, said although the role of the pre-sale system will weaken nationwide, it will unlikely be totally removed in the near term. Chen Wenjing, director of policy research at the China Index Academy, warned that eliminating the pre-sale model in favour of a completed homes only system would challenge the capital situation of real estate companies.

China's CPI is expected to rise slightly in H2, supported by measures to boost domestic demand and less drag from energy prices, Shanghai Securities News reported, citing Yu Ze, vice dean of the School of Economics at Renmin University. Global oil prices will likely stabilise and domestic coal prices may bottom out, Yu added. Although CPI fell 0.1% y/y in May, prices of industrial consumer goods excluding energy increased by 0.2 percentage points from April, as policies continued to take effect, according to Yu. Tourism demand also picked up, with May hotel prices at a decade high, the newspaper said.