Central bank drains liquidity from market

The People’s Bank of China, the central bank, continued to drain liquidity from the financial system on Thursday, with more reverse repos maturing than conducted. The PBOC conducted 40 billion yuan ($5.8 billion) of seven-day reverse repos at an interest rate of 2.55 percent and 20 billion yuan of 14-day reverse repos at 2.7 percent, according to a statement. The interest rates were unchanged from previous operations. dollar on Thursday, according to the China Foreign Exchange Trade System. In China’s spot foreign exchange market, the yuan is allowed to rise or fall by 2 percent from the central parity rate each trading day. The central parity rate of the yuan against the US dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day.