BEIJING (Xinhua) – China’s central bank pumped CNY40 billion (about USD5.6 billion) into the financial system yesterday.
The People’s Bank of China injected the liquidity through 14-day reverse repos at an interest rate of 2.7 per cent. With no reverse repos maturing yesterday, this led to a net injection of CNY40 billion.
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.
China will keep its prudent monetary policy “neither too tight nor too loose” while maintaining market liquidity at a reasonably ample level in 2019.