Fang Xinghai outlines importance of futures market in two speeches
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Stock exchanges tighten scrutiny of program trading
These rules have long been in the works and are necessary to comply with provisions of the Securities Law. That said, it’s also no coincidence that the measures were released in conjunction with the slew of recent actions to bolster stock prices in the wake of the Politburo’s July call to “enliven capital markets and restore investor confidence…”
State Council releases plan to develop Shenzhen-Hong Kong technology cooperation zone
Hong Kong has world-class universities and a sophisticated, internationally integrated financial system. Shenzhen has one of the world’s highest concentrations of tech companies…
PBoC cuts banks’ forex reserve requirement to offer support to CNY exchange rate
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Major banks lower deposit rates, as interest rate environment continues to ease
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Securities regulator unveils raft of measures to reform Beijing Stock Exchange
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August foreign financial institution approvals and specific financial opening developments
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Regulators announces numerous measures to reform equity markets, boost prices
Some of these measures are clearly aimed at stimulating short-term investor appetite to purchase stocks, and to hopefully increase market confidence. But they are also a genuine attempt to make markets more functional, accessible, and efficient in the long term, so that more investor and household cash flows into equity markets as a matter of course…
PBoC releases Q2 monetary policy report
The PBoC’s comments reinforce the view that China’s authorities are convinced they have a winning policy mix and intend to stick with it. We don’t share their optimism…
PBoC completes overhaul of nationwide branch network as part of government restructuring plan
This latest reorganization makes a lot of sense. First, it’s a recognition that the regional branches established 25 years ago didn’t operate effectively…
PBoC cuts LPR rates
The disappointing rate decline reflects the PBoC’s concern that widening spreads between US and Chinese interest rates will further weaken the RMB and that eroding bank profits by narrowing net interest margins (NIM) will destabilize the financial system. The lower one-year LPR will provide some relief to firms seeing rising real costs of credit due to deflationary producer prices…
NFRA approves seven firms to set up reinsurance operations in Lingang FTZ
The speed with which these approvals were processed signals regulators’ intent to accelerate the development of the reinsurance industry. China’s reinsurance market remains underdeveloped in relation to its fast-growing primary insurance market…
Regulators urge financial institutions to boost lending, support for the real economy
Banks have traditionally come to the rescue in previous economic downturns by pumping credit into infrastructure and housing. That’s no longer a viable solution…
Household deposits drop, but no sign of increased consumption
With consumer and business confidence still weak, interest rate cuts are simply encouraging savers to reallocate their savings into new assets – or liability reductions – rather than breaking out the checkbook to buy fancy new toys…
PBoC cuts three key interest rates
10-15 basis point rate cuts will do little to boost the economy, even if authorities make another couple of cuts before year end. That said, since upstream deflation has pushed up the real cost of borrowing for firms, even small LPR cuts will be welcome relief for struggling businesses…
Block trading to be introduced on Stock Connect
Improvements to the Stock Connect program have been a notable bright spot vis-a-vis China’s otherwise decelerating financial opening. This is just one of numerous recent incremental moves to expand the scope of the Connect, which has become the primary access point to mainland markets for foreign investors…
NFRA calls on insurance companies to speed up claims payments after major flooding, urges more support for water infrastructure
The impact of climate change and extreme weather events is becoming a critical issue for insurers globally. However, the issue is particularly acute in China, which has experienced a significant increase in flooding and drought that’s affecting vast swathes of the country…
Charles Li’s Micro Connect officially launches in Macau
While the effectiveness of Micro Connect remains to be seen, its very existence checks two key policy boxes…
CSDC reduces reserve requirement for securities firms
Less cash sitting around in reserve accounts means more funds for securities firms to do what they do best – allocate capital…
NFRA releases draft measures to curb illegal activity at financial firms
Financial regulators and anti-corruption watchdogs have been stepping up supervision of the financial sector as the scale of illegal activity and graft has slowly been exposed by the deluge of detentions and prosecutions…