Headquarters of the People's Bank of China, the central bank, is pictured in Beijing on September 28, 2018. (Photo: Agencies)
BEIJING -- China's central bank Thursday pumped cash into the banking system via reverse repos to maintain liquidity.
The People's Bank of China injected 50 billion yuan (about $7.15 billion) into the market through seven-day reverse repos at an interest rate of 2.2 percent, according to a statement on the website of the central bank.
The injection offset the 50 billion yuan of reverse repos maturing Thursday.
The move was intended to maintain reasonable and ample liquidity in the banking system, the central bank said.
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 pursues a prudent monetary policy in a more flexible and appropriate way, according to this year's government work report.
The country used a variety of tools including required reserve ratio reductions, interest rate cuts, and re-lending to enable M2 money supply and aggregate financing to grow at notably higher rates than last year.