The Chinese central bank has sought to keep liquidity steady via open market operations as the novel coronavirus outbreak continues to impact China’s economy.
On 10 February the People’s Bank of China (PBOC) undertook 900 billion yuan in reverse repo operations, including 700 billion yuan in 7-day reverse repos with a rate of 2.4%, and 200 billion yuan in 14-day reverse repos with a rate of 2.55%.
The move offset 900 billion yuan in instruments that matured on the same date.
PBOC recently made a mammoth 1.7 trillion yuan liquidity injection via reverse repo operations on 3 – 4 February, in order to help offset the economic impacts of the novel coronavirus outbreak.
On 3 February PBOC 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.