MNI China Daily Summary: Wednesday, January 7

DATA: The People's Bank of China (PBOC) increased its gold holdings for a 14th consecutive month, while foreign exchange reserves recorded month-on-month growth in December, the State Administration of Foreign Exchange said. China's gold reserves stood at 74.15 million ounces at the end of December, an increase of 30,000 ounces from the previous month. As of the end of December 2025, China's foreign exchange reserves totaled USD3.3579 trillion, rising by USD11.5 billion, or 0.34%, compared to the end of November. 

LIQUIDITY: The PBOC conducted CNY28.6 billion via 7-day reverse repos, with the rate unchanged at 1.40%. The operation led to a net drain of CNY500.2 billion after offsetting maturities of CNY528.8 billion today, according to Wind Information.

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) rose to 1.4625% from 1.4326%, Wind Information showed. The overnight repo average increased to 1.2674% from 1.2628%.

YUAN: The currency weakened to 6.9912 to the dollar from 6.9813 on Tuesday. The PBOC set the dollar-yuan central parity rate higher at 7.0187, compared with 7.0173 set on Tuesday. The fixing was estimated at 6.9849 by Bloomberg survey today.

BONDS: The yield on 10-year China Government Bonds was last at 1.8960%, up from Tuesday's close of 1.8765%, according to Wind Information.

STOCKS: The Shanghai Composite Index edged up 0.05% to 4,085.77, while the CSI300 index fell 0.29% to 4,776.67. The Hang Seng Index declined 0.94% to 26,458.95.

FROM THE PRESS: Beijing's policy drive to boost technological innovation amid economic restructuring and improved performance of listed companies is expected to prolong the latest A-share rally, Yicai.com reported citing analysts. Meanwhile, ample liquidity, record low domestic interest rates, and long-term funds entering the market will also help to extend the bull market, the newspaper said. The market may be shifting from a valuation repair phase to a profit-driven phase after the Shanghai Composite Index set a new 10-year record on Tuesday, analysts said, noting opportunities in AI, domestic semiconductor production, new energy technologies, and innovative drugs as well as geopolitical risks that need close monitoring.

Several provinces have set their 2026 priorities on technological innovation, major project construction and optimising the business environment, the 21st Century Business Herald reported, citing statements from local meetings. Beijing has released an action plan to build an AI innovation hub, aiming to expand the industry to more than CNY1 trillion in scale over the next two years. Henan said it will implement a range of infrastructure projects, including comprehensive transportation systems, new energy systems, modern water networks and urban renewal. Hainan said it would expand the import and supply of high-quality goods and services, with a focus on duty-free shopping for offshore consumers, healthcare and international education.

China's logistics industry prosperity index rose by 1.5 percentage points to 52.4% in December, hitting the highest level of the year, CCTV News reported citing data from the China Federation of Logistics and Purchasing. The logistics volume sub-index increased for the second month to 52.4%, along with the equipment-utilisation rate, new orders, the capital turnover rate and employment sub-indices, which all rose into the expansion range.