5 Officials Speak Out on Tuesday

In addition to central bankers, other officials discussed trade and deleveraging.

Here are the 5 headlines, plus some parts of under reported comments:
Pan Gongsheng: I am confident to maintain the basic stability of the RMB at a reasonable and balanced level.

Source: China Securities Network Shangzheng Bao APP · Author: Zhang Yi
Yi Gang, Governor of the People's Bank of China, accepted an interview with China Securities Journal on the recent foreign exchange market situation.

Source: China Securities Journal

China’s central bank Sun Guofeng: China will not use the RMB exchange rate as a tool to deal with trade disputes

Source: Bloomberg News

Central Bank Counselor Sheng Songcheng: I don’t think the renminbi will depreciate sharply.

Source: Wall Street Journal
Ma Jun, the political commissar of the central bank: De-leverage will not be across the board

Source: China Financial News Author: Reporters Li Guohui

This reporter, Li Guohui, today, the State Council Financial Stability and Development Committee held its first meeting to determine the tone of future financial stability work. Ma Jun, member of the Monetary Policy Committee of the People's Bank of China and director of the Center for Finance and Development Studies at Tsinghua University, believes that “the financial stability committee has stronger coordination, more authority, and more participants than the previous three-party coordination mechanism. It will help to avoid the situation of different regulatory authorities and the excessive liquidity and market panic caused by the superposition of supervision.” In addition, Ma Jun said, “In the future, the regulatory layer will pay more attention to the structure. Structural deleveraging, avoiding excessive use of leverage measures at the aggregate level."
Article: Pan Gongsheng, deputy governor of the central bank: Proper breach of contract is a constraint, and a new regulation for panda debt will be introduced (with full text of the speech)

On July 3, the Bond Pass Annual Forum was held. Pan Gongsheng, deputy governor of the central bank and director of the foreign exchange bureau, attended and spoke.

At the scene, Pan Gongsheng mainly introduced the reform and development of the Chinese bond market and the opening up. He believes that by the end of May, the default rate of China's bond market was 0.39%, and the ratio of default amount to the company's credit bond was 0.39%, which was significantly lower than the non-performing loan ratio of commercial banks of 1.74%, which was also significantly lower than that of the international bond market. The default rate is 1.2%-2.08%.

Pan Gongsheng said that the default of the bond market is also a natural reaction and normal phenomenon of corporate credit risk demonstration under the conditions of market economy. "There is a proper default, either for the issuer or for the investor. It is a constraint. The difference in credit will be reflected in the price of the bond issued. So I think these things are against Chinese bonds. It is a good thing for the long-term and healthy development of the market."

He said that the central bank is also learning from the mature experience of the international market, further improving related institutional arrangements, improving the disposal efficiency of default bonds, including developing the disposal market for bad bonds, launching a trading mechanism for expired default bonds, and guiding the disposal of specialized non-performing assets. Institutions participate in the disposal of default bonds.

In terms of opening up the bond market, Pan Gongsheng said that it has been promoted in two dimensions. First, foreign institutions have issued panda bonds in China, and second, foreign institutions have invested in China's bond market. By the end of May 2018, the inter-bank bond market had issued more than 160 billion yuan of panda debt. At the end of May, 918 foreign investors invested in the Chinese bond market, and the balance of investment was 1.48 trillion.

He also introduced some considerations about the opening up of the Chinese bond market. First, in the issue of panda bond issuance, a document on the issuance of bonds by overseas institutions will be released soon, so that overseas issuers have a clearer and clearer issuance guidelines. The document will simplify the issuance management of bonds issued by foreign institutions in mainland China. Financial institutions will issue panda bonds issued by the People's Bank of China, non-financial institutions, and overseas sovereign institutions will issue Panda bonds to be registered and issued by the Association of Dealers. Arrangements can be registered in sequence and in separate releases.

Pan Gongsheng said that since the beginning of this year, China's national economy has continued to maintain overall stability, stable and moderate development, supply and demand structure and corporate efficiency continue to improve, and the endogenous power of economic growth has continued to increase. With the adjustment of China's economic structure and the transformation of economic growth mode, with the advancement of supply-side structural reform, China's economic growth will be more efficient, more quality and more sustainable. Therefore, the sustainable development of the Chinese bond market has a good economic foundation.

He added that since the beginning of this year, the flexibility of the RMB exchange rate has increased, and it has performed strongly in the currencies of emerging market economies. China's economic growth fundamentals are good, the quality and efficiency of economic growth are improving, and the endogenous power and economic growth of economic growth. The resilience is enhanced, and China's international balance of payments is generally balanced, and foreign exchange reserves are sufficient. "Over the years, we have accumulated rich experience and sufficient policy tools. We are confident that we will maintain the basic stability of the RMB exchange rate at a reasonable and comprehensive level."
Regarding the last story, here's English language coverage from Reuters: China to simplify Panda bond rules to boost issuance

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