China’s c.bank injects RMB43b via reverse repo

The People’s Bank of China (PBC) injected liquidity into the banking system on Monday through RMB43 billion ($5.9 billion) in seven-day reverse repurchase agreements, the central bank said in a statement.

The short-term funds were provided at an interest rate of 1.50 per cent, unchanged from previous operations. The entire amount of RMB43 billion was fully allotted through quantity bidding.

The move is part of the PBC’s regular open market operations aimed at maintaining reasonable and ample liquidity within the financial system.

Reverse repos are a common tool used by the central bank to manage short-term liquidity by purchasing securities from commercial banks with an agreement to sell them back in the near term.

Attribution: Amwal Al Ghad English