The Chinese central bank has reduced reverse repo rates by 20 basis points following a prolonged absence from use of the instruments since the middle of February.
On 30 March the People’s Bank of China (PBOC) announced that it was undertaking 50 billion yuan in seven-day reverse repo operations, following a hiatus of 29 consecutive work days.
PBOC said that it was reducing the reverse repo rate to 2.20% from 2.40%.
The last time that PBOC undertook reverse repo operations was on 17 February, when it injected 200 billion yuan via 1 year medium-term lending facilities at a rate of 3.15% and 100 billion yuan via 7-day reverse repos at a rate of 2.40%.
PBOC cut the 7-day reverse repo rate and 14-day verse repo rate by 10 basis points at the start of February to 2.4% and 2.55% respectively, as part of efforts to stymie the impact of the COVID-19 outbreak.
Just after the close of the Lunar New Year the PBOC made a mass injection of 1.7 trillion yuan on 3 – 4 February via open market operations.