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China's central bank skips reverse repos Thursday

Xinhua | Updated: 2020-04-16 14:05
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A teller counts cash at a bank branch in Hangzhou, capital of East China's Zhejiang province. [Photo by Hu Jianhuan/For China Daily]

BEIJING - The People's Bank of China (PBOC), the country's central bank, skipped open market operations via reverse repos Thursday.

The banking system reports reasonable and sufficient liquidity at present, the PBOC said in an online statement.

No reverse repos matured Thursday.

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.

The central bank on Wednesday lowered the rate of 100 billion yuan ($14.3 billion) worth of one-year MLF to financial institutions by 20 basis points to 2.95 percent to ease COVID-19 strains on the economy.

Meanwhile, the implementation of the 50 basis-point reduction on reserve requirement ratio for small and medium-sized banks starting Wednesday is expected to unleash around 200 billion yuan of long-term capital into the market.

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