MNI China Press Digest Sep 4: PBOC, Local Gov Bonds, Shanghai

Highlights from Chinese press reports on Thursday:

• The Ministry of Finance and the People’s Bank of China will deepen cooperation, strengthen coordination and continue to promote the stable and healthy development of China’s bond market as well as ensure the effective implementation of fiscal and monetary policies, according to a statement on the PBOC website. The Ministry and the Bank’s Joint Working Group held its second group leaders’ meeting, and had in-depth discussions on financial market operations, government bond issuance management, central bank treasury trading operations and improving the offshore yuan-denominated treasury issuance mechanism, the statement said.
• Local governments are increasingly issuing special bonds to inject capital into government investment funds to support local technology innovation, strategic emerging and future industries, 21st Century Business Herald reported. Ningbo city, Shanxi province and Shanghai city all allocated CNY5 billion from August special bond issuance for this purpose, following Beijing city’s first-ever move to issue CNY10 billion such bonds for its municipal government investment guidance fund in June, the newspaper said. There were a total CNY977.6 billion local government bonds issued in August, with new special bonds accounting for CNY486.6 billion, the newspaper added.
• New home transaction areas in Shanghai rose 35% in the last week of August over the prior week, after the city scrapped the limit on the number of houses purchased outside the outer ring road and lowered borrowing costs, 21st Century Business Herald reported. The housing market is expected to heat up further as developers accelerate project marketing, while a boost in trading conditions will also lift developers’ confidence for more stable prices, the newspaper said citing analysts.