SHANGHAI/SINGAPORE, Aug 17 (Reuters) - China Development Bank said late Wednesday it plans to raise overseas dollar debt to increase onshore dollar liquidity after the country's central bank relaxed rules last month to allow firms and financial institutions to borrow more from overseas.
The decision comes after the People's Bank of China (PBOC) raised a parameter on cross-border corporate financing under its macro-prudential assessments (MPA) to 1.5 from 1.25 in July, the policy bank said.
"The yuan exchange rate's upward trend in mid- to long-term has remained unchanged," the policy bank said in a statement on official WeChat account.
"Funds raised from the (offshore) bonds will be mainly used to support the construction and business development of the Shanghai Free Trade Zone."
China Development Bank has been actively using both domestic and overseas markets to raise funds, it said, and has raised a total of more than 1.2 billion equivalent U.S. dollars since 2018 to serve the business developments of the FTZ.
However, it didn't provide further details about the upcoming debt issuance.
China's yuan has faced renewed depreciation pressure in recent weeks and weakened to nine-month lows against the dollar on Thursday, pressured by widening yield differentials with the United States and expectations of more monetary policy easing.
(Reporting by Winni Zhou and Tom Westbrook; Editing by Shri Navaratnam)
