MNI China Press Digest July 15: Yuan, Implicit Debt, EVs

Highlights from Chinese press reports on Tuesday:

• The yuan is expected to remain strong in the second half, supported by China’s economic resilience and the rising possibility of Federal Reserve cuts amid growing pressure from U.S. President Donald Trump, wrote Xiao Yu, associate researcher at the Chinese Academy of Social Sciences, in a commentary. Xiao noted that U.S. tariff policy could cause great uncertainty in the dollar. Xiao said international capital was optimistic about the yuan, highlighting the offshore yuan had increased about 2.5% in the past six months, higher than the 1.8% rise in the onshore yuan. (Source: 21st Century Business Herald)
• China should allow local governments to tap into future bond quotas to proactively address off-balance sheet debt, analysts told Yicai.com. In the first half of the year, approximately 81% of the 2025 quota for resolving implicit debt was utilised, equivalent to CNY2.26 trillion in government bonds, the outlet reported. With only CNY539 billion remaining under this year’s quota, analysts suggest leveraging future quotas, which stand at CNY2.8 trillion in 2026 and CNY800 billion each in 2027 and 2028.
• China saw 5.62 million new energy vehicle registrations in the first half, an increase of 27.9% y/y, setting a record high, Economic Information Daily reported, citing data by the Ministry of Public Security. Nationwide car ownership reached 359 million by the end of June, with electric vehicles accounting for 10.3% of the total, the newspaper said.