China’s central bank injects 14.1b yuan via reverse repo

People’s Bank of China (PBC) conducted a seven-day reverse repurchase agreement (reverse repo) on Monday, injecting 14.1 billion yuan into the financial system at an interest rate of 1.50 per cent.

The move is part of the central bank’s efforts to ensure adequate liquidity in the banking sector, signaling its commitment to maintaining stability in the financial markets.

A reverse repo is a key monetary policy tool used by central banks to regulate liquidity. Through this mechanism, the PBC purchases securities from commercial banks via a bidding process, with an agreement to sell them back at a later date.

Attribution: Amwal Al Ghad English