CBN丨China's central bank unexpectedly holds key rate steady

Hieveryone.I’mStephanieLI.

Comingupontoday’sprogram

• China’scentralbanksurprisesmarketsbyleavingmedium-termrateunchanged,butaddsliquidity;
• ChinesepremierarrivesinSwitzerlandforDavosforum.

Here’swhatyouneedtoknowaboutChinainthepast24hours 

ThePeople’sBankofChinaonMondayadded995billionyuan($138.84billion)worthofone-yearmedium-termlendingfacility(MLF)loanstosomefinancialinstitutions,butsurprisedmarketsbyleavingtheinterestrateunchangedwhenrollingovermaturingmedium-termpolicyloans.

Atotalof995billionyuanwasinjectedintothemarketviatheMLF,whichwillmatureinoneyearataninterestrateof2.5percent,unchangedcomparedtothepreviousoperation,accordingtoastatementonthecentralbank’swebsiteonMonday.

With779billionyuanworthofMLFloanssettoexpirethismonth,theoperationresultedanet216billionyuanfreshfundinjectionintothebankingsystem.

Thecentralbankalsoinjected89billionyuanthroughseven-dayreversereposwhilekeepingborrowingcostunchangedat1.8percent,itsaidinanonlinestatement.

TheMLFinterestratehasnotfallenthismonth,probablybecausethepolicymakersarestillwaitingtoseetheeffectofthepolicytoolspreviouslyissuedtoboosttheeconomy,notedGoldenCreditRatingInternational.Thepolicytoolsincluded350billionyuanpledgedsupplementarylendingaddedlastmonthand1trillionyuanofnationaldebtissuedinthefourthquarteroflastyear.

TheChineseeconomyhasbeencontinuingitsrecovery,withfinancialdatastayingstablelastmonth,whileloangrantingjumpedreasonablylastyear,indicatingthemarketinterestratesarewithinafairrange,saidZhouMaohua,amacroanalystatChinaEverbrightBank'sfinancialmarketdepartment.ThePBOChikedthenetliquidityinjectionviatheMLFtoguidefinancialinstitutionstogoonincreasingsupporttotherealeconomy,headded.

• ChinesePremierLiQiangarrivedinZurich,SwitzerlandonSunday,andisexpectedtodeliveraspecialaddressonTuesdayattheopeningoftheWorldEconomicForumAnnualMeetinginDavos,whichwillbeheldfromMondaytoFriday.Themed"RebuildingTrust”,theDavosforumwillbeattendedbymorethan2,800delegatesfrombusinesses,governments,internationalorganizationsandcivilsocietyfromaroundtheworld,includingmorethan60headsofstateandgovernment,todiscusstheworld'smostpressingissuesandsetprioritiesfortheyearahead. 
• China'sforeigntradegrew0.2percentyear-on-yearto41.76trillionyuan($5.87trillion)in2023,withDecemberdatagearingupexpansionatarateof2.8percentinyuan-denominatedterms,customsdatashowedonFriday.Exportsgrew0.6percentyear-on-yearto23.77trillionyuanlastyear,whileimportsedgeddown0.3percentyear-on-yearto17.99trillionyuan.Inparticular,totalimportsandexportsforDecemberalonecameinat3.81trillionyuan,hittingarecordhighonamonthlybasis.
• China'sconsumerpricesdroppedforthethirdconsecutivemonthinDecember.DatafromtheNationalBureauofStatisticsshowedonFridaythatthecountry'sCPIdroppedby0.3percentyear-on-yearinDecemberaftera0.5percentdropinNovember.Forthefullyearof2023,theCPIroseby0.2percentyear-on-year.China'sproducerpriceindex,whichgaugesfactory-gateprices,droppedby2.7percentyear-on-yearinDecember,followinga3percentfallinNovember,theNBSsaid.Fortheentireyear,China'sPPIdipped3percent.

GreaterBayArea,Greaterfuture

• Guangzhou,thecapitalcityofsouthChina'sGuangdongProvince,isexpectedtoseeitsGPDexceed3trillionyuanin2023,localauthoritiessaidMonday.Boththetotalretailsalesofconsumergoodsandtotalvalueofitsimportsandexportshaveexceeded1trillionyuanforthethirdconsecutiveyear.Meanwhile,fixedassetinvestmentsurpassed860billionyuan.Theaddedvalueofthecoreindustriesinthedigitaleconomyaccountedfor13percentoftheregionalGDPin2023.Thecityhasalsoacceleratedthedevelopmentofemergingindustries,withtheproductionofnewenergyvehiclesexceeding650,000units,whichrepresentsgrowthof1.08timesthatofthepreviousyear.Theaddedvalueofstrategicemergingindustriesrepresentedover30percentoftheregionalGDP.Thecityalsosetits2024GDPgrowthtargetatmorelessthan5percent.
• Shenzhenreportedatotalcross-bordere-commerceforeigntradevolumeof326.53billionyuanin2023,up74.4percentyear-on-year,themunicipalbureauofcommercesaidonSaturday.Datashowthatthenumberofcross-bordere-commerceexportenterprisesinShenzhennowexceeds150,000,accountingforalmosthalfofChinesesellersonplatformsincludingAlibaba.com,AliExpress,Lazada,andeBay,andone-thirdofChinesesellersonAmazoncomefromShenzhen.
• HongKongwelcomed34millionvisitorsin2023,withtheChinesemainlandremainingitslargestsourcemarketandaccountingfor79percentofthetotalfigureamidtheregion'stourismrebound,accordingtotheHongKongTourismBoardonSaturday. Some27milliontravelersfromtheChinesemainlandmadetripstoHongKonglastyear,whichaccountedfor79percentoftheregion'stotalvisitors. 

Nextonindustryandcompanynews

• Chinahasmaintaineditstoppositionintheglobalshipbuildingmarketin2023,withstronggrowthinbothoutputandneworders.Thecountry'sshipbuildingoutputclimbed11.8percentyearonyearto42.32milliondeadweighttons(dwt)in2023,accountingfor50.2percentoftheworld'stotal,accordingtodatafromtheMinistryofIndustryandInformationTechnologyonMonday.Neworderssurged56.4percentyearonyearto71.2milliondwt,takingup66.6percentoftheworld'stotalduringtheperiod.
• AnewaircargoroutewaslaunchedonSaturdaymorninglinkingEzhouHuahuAirportincentralChina'sHubeiProvincewithLahoreinPakistan,saidSFAirlines,China'slargestaircargocarrierinfleetsize.TheEzhou-Lahorecargoroutewiththreeweeklyround-tripflightsisthefirstinternationalaircargoroutelaunchedbySFAirlinesthisyear,whichwillbringatotalofaround300tonsofairexpresscapacityperweek,accordingtotheairline.
• TencentHoldings'HonorofKings,themostpopularmobilegameinChina,saidonSaturdaythatitwillbeavailableforlivestreamingonChina'sbiggestlivestreamingplatformDouyinfromJan.21,asitsmonthlyactiveusershavefallentoaround150millionfromapeakof200million.
• HepalinkPharmaceuticalGroup'ssharesfellaftertheworld'slargestsupplierofheparinrawmaterialssaiditssubsidiaryTechdowPharmaItalyrecentlylostEUR11.7milliontoatelecomfraud.Theincidentwasanisolatedevent,withTechdowPharmaoperatingasnormal,itsparentfirmannouncedyesterday,addingthattheincidenthasbeenreportedtothepolice.
• UKpharmaceuticalgiantAstraZenecaplanstoinvest190millionyuantobuildanewproductionlineatitsTaizhoubaseinChinatomakeanewdiabetesdrugapprovedformarketinginthecountrylastyear. 
• China’sinternetgiantsAlibaba,TencentandBaidu,orBAT,haveslashedexternalinvestmentsbynearly40percentto102in2023,accordingtodatacompiledbyChineseconsultancyITJuzi. Tencentsawthelargestreductionindeals,striking39investmentcontractswith37companieslastyear,asharpdeclinefromthe95and299dealsitmadein2022and2021.AlibabaandBaidueachparticipatedin39and24investmentdealslastyear,downfrom91and52in2021,respectively.

Switchinggearstofinancialnews

• ThecorporateandenterprisebondmarketoftheBeijingStockExchange(BSE)startedtradingonMonday,markingakeystepinthebourse'shigh-qualitydevelopment.Threeenterprisebondsworth2.48billionyuanintotalhavebeenissuedonthefirstdayoftrading,accordingtotheBSE.
• CashdividendsofChineselistedfirmshitarecordhighof2.13trillionyuanin2023,saidthecountry'ssecuritieswatchdog.Sofar,atotalof3,361firmslistedontheShanghaiandShenzhenbourseshavedisclosedtheir2023plansfordividendpayouts,accountingfor65.9percentofthetotallistedfirms,accordingtotheChinaSecuritiesRegulatoryCommission(CSRC).

Wrappingupwithaquicklookatthestockmarket

• ChinesestocksendedmixedonMondaywiththebenchmarkShanghaiCompositeinchingup0.2percent,whiletheShenzhenComponentslid0.4percent.HongKong’sHangSengindexfell0.2percentandtheTECHindexdropped1.9percent.

BizWordoftheDay

• Thecorporatebondmarketisa sectionofthebondmarketwhereinvestorsbuyandselldebtsecuritiesissuedbycorporations. Corporatebondsoffer higheryieldsthangovernmentbonds,butalsocarrymoreriskofdefault. Thecorporatebondmarketisthe secondlargestsegmentoftheglobalbondmarket,aftergovernmentbonds.

ExecutiveEditor:SoniaYU

Editor:LIYanxia

Host:StephanieLI

Writer:StephanieLI 

SoundEditor:StephanieLI

GraphicDesigner:ZHENGWenjing,LIAOYuanni

Producedby21stCenturyBusinessHeraldDept.ofOverseasNews.

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策划、编辑：李艳霞 

播音：李莹亮

撰稿：李莹亮

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