China adds liquidity via ¥50b reverse repos

The People’s Bank of China (PBC) announced on Monday that it had conducted 50 billion yuan (about US$7.04 billion) of seven-day reverse repos at an interest rate of 1.8 per cent.

The move aims “to maintain stable liquidity at quarter end” in the banking system, the PBC explained in a statement.

A reverse repo is a process in which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future, according to English.gov.cn – the official English-language communication platform of the State Council of the People’s Republic of China.