PBOC Injects Most Cash in Three Years in Open-Market Operations
- China adds 400 billion yuan using 7-, 28-day reverse repos
- Standing Lending Facility, Medium-term Lending Facility used
PBOC Injects Most Cash in Three Years
China’s central bank cranked up cash injections in its money-market operations for the third week in a row, heading off a squeeze as a seasonal jump in demand for funds coincides with surging capital outflows.
The People’s Bank of China added 400 billion yuan ($61 billion) to the financial system using reverse-repurchase agreements, the most in three years, bringing net injections via its various lending tools for the month to more than 1 trillion yuan. The Chinese New Year holiday, a period when families get together for celebrations and exchange gifts, will shut banks for the week starting Feb. 8. Guotai Junan Securities Co. estimates cash demand will surge by about 3 trillion yuan in the run-up to the break.