CHINA’S central bank said it would increase funding support for the private sector after meeting with executives from the property industry, identifying several companies by name in a statement that underscores growing urgency among regulators to boost market confidence.
Newly appointed People’s Bank of China (PBOC) governor Pan Gongsheng met with representatives from eight private firms, including developers Longfor Group Holdings, CIFI Holdings Group and Midea Real Estate Holding to hear about their difficulties and corporate financing needs, the PBOC said in a statement on Thursday (Aug 3). Banks such as Industrial and Commercial Bank of China were present as well.
The meeting is the latest in a series of attempts by regulators across China’s government to shore up the private sector as the country’s economic recovery sputters and stress in some corners of the bond market increases. Reviving the property market would be key to boosting growth, with the Communist Party’s Politburo last week signalling a shift towards looser policies for the sector.
Zhang Zhiwei, chief economist at Pinpoint Asset Management, said the message from top officials is to support the housing market, although it’s unclear if any new measures are coming.
“Under-stressed sectors require more financial help, and that’s the property sector, which is clear,” said Zhang.
Chinese high-yield dollar bonds gained about 1 US cent on Friday morning, according to credit traders, after dropping earlier this week. The strongest-performing developer was investment-grade rated Longfor, whose 3.375 per cent bond due 2027 jumped 3.5 cents to 73.9 cents, set for the largest advance in over a week.
Source : TheBusinessTimes