MNI China Daily Summary: Wednesday, Sept 24

EXCLUSIVE: Concern about a fourth-quarter economic slowdown is building within China’s interbank money market, feeding expectations for additional monetary easing, MNI’s China Money Market Index indicated.

POLICY: Chinese officials unveiled a plan aimed at stabilising and upgrading China’s building materials industry over the 2025–2026 period, including measures to enhance profitability and strengthen innovation.

POLICY: China’s decision to relinquish its special and differential treatment (SDT) at the World Trade Organization (WTO) will invigorate WTO reforms and further accelerate global trade and investment liberalisation, Li Chenggang, China's international trade negotiator and vice minister at the Ministry of Commerce told reporters.

LIQUIDITY: The People's Bank of China (PBOC) conducted CNY401.5 billion via 7-day reverse repos, with the rate unchanged at 1.40%. The operation led to a net drain of CNY17 billion after offsetting maturities of CNY418.5 billion today, according to Wind Information

LIQUIDITY: The People’s Bank of China will inject CNY600 billion via the Medium-term Lending Facility on Thursday, adding a net CNY300 billion to liquidity. According to a statement on the PBOC website, the maturity of the operation will be one year, using a fixed-volume, interest rate bidding, and multiple-price allotment method, in a bid to maintain ample liquidity in the banking system. 

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) rose to 1.5864% from 1.4754%, Wind Information showed. The overnight repo average increased to 1.4373% from 1.4141%.

YUAN: The currency weakened to 7.1219 to the dollar from 7.1133 on Tuesday. The PBOC set the dollar-yuan central parity rate higher at 7.1077, compared with 7.1057 set on Tuesday. The fixing was estimated at 7.1107 by Bloomberg survey today.

BONDS: The yield on 10-year China Government Bonds was last at 1.8900%, down from Tuesday's close 1.8740%, according to chinamoney.com.cn.

STOCKS: The Shanghai Composite Index increased 0.83% to 3,853.64, while the CSI300 index edged up 1.02% to 4,566.07. The Hang Seng Index rose 1.37% at 26,518.65.

FROM THE PRESS: China's total electricity consumption rose by 5% y/y to reach 1.01 trillion kWh in August, exceeding the one trillion mark and setting a new high for two consecutive months, Securities Daily reported citing data by National Energy Administration. This was mainly driven by rising consumption in the tertiary industry and by residents as the hot and humid weather came early and lasted longer. Consumption in the secondary industry continued to recover amid pro-growth policy measures, with the 5.5% growth in manufacturing sector driven mainly by steel and building materials, marking the highest monthly consumption so far this year, the newspaper said.

China will quicken the creation of a number of emerging pillar industries as new growth drivers, and strengthen cutting-edge technology research and development to focus on humanoid robots, brain-computer interfaces, metaverse, and quantum information for the 15th Five-Year Plan (2026-2030), China Securities Journal reported citing Li Lecheng, Minister of Industry and Information Technology.

The number of monthly active users of stock trading apps reached 173 million amid August's A-share rally, a rise of 4% m/m or 27% y/y, marking the highest monthly record in 2025, 21st Century Business Herald reported. The rally is also driving new investors into the market, with the number of new A-share accounts opened last month reaching 2.65 million, an increase of 35% m/m or 165% y/y, according to data from the Shanghai Stock Exchange, the newspaper said.