Cen­tral bank in­jects money

China Daily (Hong Kong) - - BUSINESS -

China’s cen­tral bank con­ducted cash in­jec­tions via open mar­ket op­er­a­tions, to ease liq­uid­ity on Thurs­day. The Peo­ple’s Bank of China con­ducted 60 bil­lion yuan ($8.9 bil­lion) of seven-day re­verse re­pos, at an in­ter­est rate of 2.45 per­cent. The in­jec­tion saw a net 20 bil­lion yuan in cash pumped into the mar­ket on Thurs­day, off­set by 40 bil­lion yuan in ma­tur­ing re­verse re­pos. In Thurs­day’s in­ter­bank mar­ket, the overnight Shang­hai In­ter­bank Of­fered Rate, which mea­sures the cost at which banks lend to one an­other, rose 6.1 ba­sis points to 2.786 per­cent. The cen­tral bank has in­creas­ingly re­lied on open-mar­ket op­er­a­tions for liq­uid­ity, rather than cuts in in­ter­est rates or re­serve re­quire­ment ra­tios, to main­tain pru­dent mon­e­tary pol­icy.

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