CHINA China's central bank injects 200 bln yuan into market Tuesday

CHINA

China's central bank injects 200 bln yuan into market Tuesday

Xinhua

12:58, June 23, 2020

BEIJING, June 23 (Xinhua) -- China's central bank on Tuesday pumped cash into the banking system via reverse repos to maintain liquidity.

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File photo by CFP

With no reverse repos maturing Tuesday, the People's Bank of China injected a total of 200 billion yuan (about 28.3 billion US dollars) into the market, including 90 billion yuan through seven-day reverse repos at an interest rate of 2.2 percent and 110 billion yuan of 14-day contract at an interest rate of 2.35 percent, according to a statement on the website of the central bank.

The move is intended to maintain stable 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 will pursue a prudent monetary policy in a more flexible and appropriate way, according to this year's government work report.

The country will use 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, said the report.

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