SHANGHAI, Mar. 7 (SMM) – Following sharp declines on Monday, all base metals on the SHFE rebounded on Tuesday, though upside space was limited. Premier Wen delivered its government work report on Tuesday, setting economic targets for 2013. Among these targets, targets for CPI growth, affordable housing construction and M2 growth fell some from last year, while targets for fiscal deficit, fiscal deficit rate, and scale of local government bonds were revised upwardly.    

China’s new five measures to cool domestic property sector caused base metals prices to plunge on Monday. The Ministry of Housing & Urban-Rural Development said detailed housing control measures will be announced this week and that local government will have to work out specific measures no later than April. The Reserve Bank of Australia decided to keep its interest rate unchanged at 3.0%. How will the global currency war evolve depends on what measures the Bank of Japan will introduce this week. 

China’s Economic Targets for 2013
China has set its GDP growth target for 2013 at 7.5% and CPI inflation target at 3.5%.

Premier Wen vowed to stabilize exports while expanding imports.

Future Policies
Development: Premier Wen puts boosting domestic demand as long-term strategy.

Problems: Premier Wen says domestic economic downturn and growing overcapacity are two biggest problems.

PV Industry: China Development Bank will control new loans for photovoltaic enterprises.

Property Sector: CBRC Chairman Shang Fulin says lending policies will be introduced following housing control policies.

Banking: CBRC Chairman Shang Fulin says deposit/loan ratio policy is being studied.

PBOC: PBOC candidate Xiao Gang supports Zhou Xiaochuan to remain as PBOC governor.

Inflation: Premier Wen warns of great inflationary pressure in 2013.

Remarks from CPPCC Members
Developers: exorbitant housing prices are rational as long as both sides agree.

Chinese economy is at risk of hard landing sooner or later.

Sources said Pan Yue will likely be appointed as Minister of Environmental Protection
Pan Yue, well-known for taking aggressive measures to solve environmental issues, was appointed as Vice Minister of the State Environmental Protection Administration in March, 2003 and as Vice Minister of the Ministry of Environmental Protection on March 24, 2008.

Obama Renews Budget Offer to Cut Social Safety Nets
President Barack Obama raised anew the issue of cutting entitlements such as Medicare and Social Security as a way out of damaging budget cuts, White House official Gene Sperling said on Sunday.

Bersani Ultimatum May Bring New Italy Election Closer
Italy could be inching closer towards another election within months after centre-left leader Pier Luigi Bersani issued an ultimatum to anti-establishment 5-Star leader Beppe Grillo to support a new government or return to the polls.

BOJ deputy governor candidate deems it necessary to revise BOJ law
BOJ deputy governor candidate said it’s necessary to revise the BOJ law so as to make the 2% inflation target attainable.

Opinions:
Chen Haowu warns of overemphasis on GDP growth following China’s leadership transition.

Zhang Liqing says GDP depends on infrastructure investment and expects tighter monetary policy.