Weekly Wrap: Flat LPR, more MLF rollover, LGFV oversight, & higher margin capacity

Research evidence excerpt

Weekly Wrap: Flat LPR, more MLF rollover, LGFV oversight, & higher margin capacity

further improve capital-account opening. Exporters’ Wenqing Han, CFA >>

FX hedging demand rose sharply in 1H, with the hedging ratio increasing to 35.3%, while Research Analyst

bank FX settlement and sales rose 24% YoY. Financials: Banking-sector regulation Merrill+852 3508Lynch5032(Hong Kong)

remained tight, with banks receiving more than RMB70mn of fines in early July and wenqing.han@bofa.com

credit violations remaining a key focus. Consumer-finance ABS issuance reached Winnie Wu >>

RMB400bn in 1H, but growth slowed under tighter regulation. WM and pension products ResearchMerrill LynchAnalyst(Hong Kong)

continued to expand, while the launch of DR-benchmark loans signaled loan pricing may +852 3508 3058

winnie.wu@bofa.com

move beyond sole reliance on LPR. Private banks are accelerating cuts to online-loan

partners more than nine months after loan-facilitation rules took effect. Zhejiang saw EmmaResearchXuAnalyst>>

city and rural commercial banks cut deposit-rate ceilings by 5bp, though analysts said Merrill Lynch (Hong Kong)

+852 3508 8165

this does not signal broader rate cuts. A-share: Market-stabilization measures emma.xu@bofa.com

accelerated, with the CSRC pledging to maintain stable market operations, central SOEs

and listed companies announcing buybacks and stake increases, and state-backed ETF

inflows reaching RMB85bn. China Life also increased equity allocation, and leading

CSRC: China Securities Regulatorybrokers raised margin-financing limits, potentially releasing nearly RMB100bn of

Commissionadditional capacity. Property: More than 20 regions launched new housing subsidies,

NDRC: National Development and Reformshifting from broad-based incentives to more targeted support.