MNI China Daily Summary: Tuesday, May 20

POLICY: China will launch most of its policy measures to stabilise employment and economic growth by the end of June, Li Chao, spokesman of the National Development and Reform Commission told reporters. 

POLICY: China’s six major state-owned banks announced reductions to their yuan deposit interest rates, state-media outlet People’s Daily reported. Interest rates for fixed-term deposits of three and five years have been reduced by 25 basis points to 1.25% and 1.3%, the daily said. 

LIQUIDITY: The People's Bank of China (PBOC) conducted CNY357 billion via 7-day reverse repos, with the rate unchanged at 1.40%. The operation led to a net injection of CNY177 billion after offsetting the maturities of CNY180 billion today, according to Wind Information.

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) decreased to 1.5856% from 1.6014%, Wind Information showed. The overnight repo average fell to 1.5163% from 1.5374%.

YUAN: The currency weakened to 7.2207 against the dollar from the previous 7.2125. The PBOC set the dollar-yuan central parity rate higher at 7.1931, compared with 7.1916 set on Monday. The fixing was estimated at 7.2107 by Bloomberg survey today.

BONDS: The yield on 10-year China Government Bonds was last at 1.6725%, up from the previous close of 1.6550% previously, according to chinamoney.com.cn.

STOCKS: The Shanghai Composite Index rose by 0.38% to 3,380.48, while the CSI300 index was up 0.54% at 3,898.17. The Hang Seng Index gained 1.49% at 23,681.48.

FROM THE PRESS: Beijing has called on Washington to cease discriminatory measures and honour the Geneva consensus, according to a spokesperson for the Ministry of Commerce, following a U.S. industry warning against using Chinese semiconductors, including Huawei. Should the U.S. continue along this path, China will take firm and necessary measures to safeguard its legitimate rights and interests, the spokesperson stated. (Source: MOFCOM website)

China’s infrastructure investment rose by 5.8% y/y from January to April, supported by the acceleration in issuance of local government special bonds earmarked for project development, according to Wang Qing, Chief Macro Analyst at Oriental Jincheng. Wang noted that, since the beginning of the year, medium- and long-term corporate lending for infrastructure projects has sustained robust growth. Meanwhile, local governments have regained momentum in project spending, aided by an easing of fiscal pressures following the debt relief programme. (Source: Yicai)

Chinese exporters are rushing to ship orders to the U.S. during the 90-day tariff reprieve, 21st Century Business Herald reports. Following the Geneva announcement, spot rates from Shanghai to Los Angeles rose 16% to USD3,136 per 40-foot container, according to Drewry, a shipping consulting firm. Meanwhile, ports are expanding networks, with Xiamen Port adding Southeast Asia routes in 2025 and Guangzhou Port operating 222 liner routes, including 152 to Belt and Road markets.