China Financial Daily

Reproduce the central bank open market operations to buy back hundreds of billions of dollars are
Since February 17 the central bank in the open market to 120 billion yuan period is 91 days after the buy-back operation, the second this week (August 4) the central bank issued 120 billion yuan to 28 Tianzheng repurchase agreements, this is the first central bank since 2009 Second multi-billion-dollar buy-back operation is over. At the same time the central bank also issued 18 billion yuan 1-year central votes.

Cinda Securities analyst bonds that expire this week, the central bank for 246 billion yuan of funds, 188 billion yuan last surge. Pressure due to return this week, so the central bank increased the repo efforts is to maintain the basic stability of the currency market.

CITIC voted bonds to build red ground field researcher pointed out that the larger the amount of funding due this week, Tuesday has 138 billion yuan from circulation, but there is still the expiration of 108 billion yuan of funds, the central bank is expected this week could be put to the market micro-net.

From the issue of interest rate perspective, the central bank on August 4 issued 1-year bills, the issue price of 98.29 yuan, the reference yield of 1.7397 percent. The yield increase over the previous period of about four basis points, rising for the fifth consecutive week. In addition, at the same time period issue is the 28-day repurchase rate also rose to 1.16 percent, the rate is lower than the previous period also rose by 4 basis points.

The report predicts that the central bank: CPI to be the bottom end of the third quarter of this year
People’s Bank of China survey released on the 28th Division, “the second quarter 2009 analysis of the macroeconomic situation,” the report predicted that China’s consumer price index (CPI) in the bottom end of the third quarter of this year.

Price trends in the development of the report in part, from the price index, the People’s Bank of the CPI calculation Leading Composite Index is still in a declining phase, the downward trend in prices in recent months will continue; Coincident Composite Index forecast, CPI will be bottom end of the third quarter of this year.

The report notes that in 2009 the People’s Bank of monitoring of the second quarter of 5000 industrial enterprises in product sales price index from the first quarter narrowed to -15.6% -8.9%, there has been a big rebound. The overall global commodity market bottom has picked up momentum, the future of “imported” inflation pressure. At the same time, domestic demand continues to rise, the continuing flow of well-off, inflation is expected to be manifested. Overall, CPI will be stable in the second half, there is likely to rebound.

Report at the same time the trend of China’s economic growth prospects. The report states that the People’s Bank of investigation from the Statistics Division to monitor the economic climate index, the industrial added value of the Coincident Composite Index is still in a declining phase, in the Leading Composite Index also fell, but reduce the drop shows that the future economic trend has stabilized, Coincident Composite Index estimates indicated that the trend of economic recovery.

People’s Bank of entrepreneurs show that the second quarter of macroeconomic heat from the previous quarter’s index increased by 7.8 percentage points to -30.8%, the five-quarter decline in a row after the first rebound. Although still in a recession interval, but cool entrepreneurs macroeconomic concerns significantly weakened. Second quarter business climate index rose 4.6 percentage points sequentially to 12.1% since the end of the quarter by quarter since the third quarter of last year down the momentum.

The first time the central bank said the credit in advance of new loans in June the number of more than 1.5 trillion yuan
Population referred to the financial industry’s “big numbers” in the evening yesterday, finally got a clear answer: the central bank will be a rare subject in advance of the credit market concern about the release. 18 o’clock last night, the central bank announced that, according to the Statistics Division of the bank to investigate the initial report in June of the loans of financial institutions of RMB 1.5304 trillion yuan from the previous month added, the new 2002.2 billion yuan from the previous month deposits.

Up capital or loans in place

June credit growth for more than 1 trillion, the market had expected, but the final figure is still more than 1.3 trillion yuan of market participants expected the highest.

Analysts believe that the institutions, in addition to bank loans at the end of the scale of red things, as a result of major infrastructure projects, capital funding from the central finance, capital unless the bank loan in place, and in May issued 70 billion investment in the third installment of the Central element, but also reduced the majority of infrastructure projects, the proportion of the capital, so in June pushed up government projects related to the size of the loan.

Yesterday, the central bank did not disclose the M1, M2 money supply, etc., as well as the proportion of loan growth, structure and other figures, but said that “detailed data will be released in recent days.” Prior to this, the central bank on the 11th of each month or a month before the release on the 12th of credit, and will use “reasonable growth”, “growth”, “increased” and the number of brief reviews of credit evaluation.

The annual 10 trillion of credit may super -

5 months ago to add figures for first half of this year, new RMB loans of financial institutions has exceeded 7 trillion yuan, reached a record high of 7.3667 trillion yuan. 5 months of this year, financial institutions, followed by incremental credit of RMB 1.62 trillion yuan, 1.07 trillion yuan, 1.89 trillion yuan and 591.8 billion yuan, 664.5 billion yuan. Last year, financial institutions?RMB loans increased 4.91 trillion yuan. At present, the first half of this year than the loan in excess of more than half last year.

“First half of this year, the banking industry experienced an unprecedented growth of credit.” Yesterday, the State Council Development Research Center, Ba Shusong, deputy director of the Institute of Finance said that even if a substantial decline in credit in the second half year is also more than 8000 billion yuan there is no problem, if the tone of macroeconomic policy unchanged, the year the credit is expected to reach 10 trillion yuan.

In fact, after the banking institutions have already made a similar forecast. Standard Chartered Bank economist Stephen Green will be the year in 2009 put the size of bank credit is raised to the estimated value of 10 trillion yuan.

Inflation is expected to blow big asset bubble

Credit for the high, the inflation expectations and the asset bubble started to form an atmosphere of fear. State Council Development Research Center, Vice-Minister Wei Jianing macroeconomic publicly expressed earlier, it was estimated that about 20% of the first half of the credit funds into the stock market, 30% of the credit funds into the paper market. In his view, such an outcome is to promote the formation of a bubble.

At present, the property market and the stock market rose more rapid economic analysts with deep concern. Many analysts say the current round of stock market prices is sufficient liquidity driven, as most of the performance of listed companies reported losses during the first half, there is no real support. And frequently expensive to produce the phenomenon of Wang, but also the substantial funds to support the beginning of eye on the real estate market.

However, experts are expected in the second half of the credit growth will not continue to maintain the first half of the “amount of days.” Internationally, some countries have begun to consider the appropriate tightening of monetary policy in an over-generous at the same time find a way to start the recovery in response to financial crisis to the currency market.

Yesterday, the central bank has responded quickly and decided to issue 50 billion yuan in one-year central counting, recycling of funds clearer signal.