The People’s Bank of China (PBOC) has undertaken 7-day reverse repo operations for three days straight following an absence from the market of 37 consecutive working days.
From 26 to 28 May PBOC undertook 10 billion yuan, 120 billion yuan and 240 billion yuan in 7-day reverse repo operations, during which period no corresponding instruments matured, for a net injection of 370 billion yuan (approx. USD$51.8 billion).
The rate for PBOC’s 7-day reverse repos was left unchanged compared to the previous operation at 2.20%.
Fan Ruoying (范若滢), a researcher from Bank of China (BOC), said to Securities Daily that the main goal was to offset liquidity disturbances and maintain market liquidity at stable and ample levels.
“Liquidity disturbances” in May included the issuance of government bonds and enterprise income tax settlement.