Chinese Central Bank Trims Reverse Repo Rates 10%

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The People’s Bank of China (PBOC) has reduced reverse repo rates during a mass liquidity injection to stem the economic impacts of the novel coronavirus.

On 3 February PBOC injected 1.2 trillion yuan (ap­prox. USD$173 bil­lion) into the Chinese banking system via reverse repo operations employing interest rate auctions.

This included 900 billion yuan in 7-day reverse repos and 300 billion yuan in 14-day reverse repos.

In a public announcement PBOC indicated that it had reduced the 7-day reverse repo rate to 2.4% from 2.5%, and the 14-day reverse repo rate to 2.55% from 2.65%, for a 10% trim across the board.

PBOC said that its open market operations were for the purpose of ensuring ample liquidity levels during efforts to combat the novel coronavirus.

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