The People’s Bank of China continues to conduct the now routine reverse repurchasing operation to inject liquidity into the banking system.
The latest round of open market operations included RMB12 billion 7-day reverse repo at 3.35%, and RMB47 billion 14-day reverse repo at 3.45%. There is no 28-day operation today. Rates on the latest operation remain unchanged compared to previous operations. Today’s injection totaled RMB59 billion.
Today’s operation brings total net injection for the week to RMB164 billion.
As there are RMB650 billion reverse repos and RMB39 billion central bank bills expiring this month, PBOC will have to conduct at least RMB611 billion reverse repos in order to make no net injection/withdrawal for the month unless other tools such as reserve requirement ratio reduction is deployed.