USEUROPEAFRICAASIA 中文双语Français
Business
Home / Business / Finance

China's central bank skips open market operations for 12th straight day

Xinhua | Updated: 2017-04-11 16:21

BEIJING - China's central bank on Tuesday again skipped open market operations of reverse repos, siphoning liquidity from the market.

This was the 12th consecutive trading day that the People's Bank of China halted the open market operations of reverse repos, a process where it purchases securities from commercial banks with an agreement to sell them back in the future.

"Although general liquidity level in the banking system fell slightly because of factors such as the looming tax payments, it is still at a relatively high level," the PBOC said in a statement.

The move meant a net cash withdraw of 20 billion yuan ($2.9 billion) from the market as previous reverse repos matured on Tuesday. The 12-day suspension has led to a total of 450 billion yuan being drained from the banking system.

Skipping reverse repo operations, part of the PBOC's efforts to deleverage, indicated the central bank has the confidence and capability to keep market liquidity at a stable level, said Wen Bin, a researcher with China Minsheng Bank.

Wen expects the PBOC to continue the use of open market operations in liquidity management, while leaving the benchmark interest rates unchanged this year.

China has vowed to pursue a prudent and neutral monetary policy this year, promising better adjustments to ensure stable liquidity.

Most Viewed in 24 Hours
BACK TO THE TOP
Copyright 1995 - . All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily Information Co (CDIC). Without written authorization from CDIC, such content shall not be republished or used in any form. Note: Browsers with 1024*768 or higher resolution are suggested for this site.
License for publishing multimedia online 0108263

Registration Number: 130349
FOLLOW US