xi's moments
Home | Finance

China's central bank adds liquidity via reverse repos, MLF

Xinhua | Updated: 2024-03-15 13:30

Headquarters of the People's Bank of China (PBOC), the central bank, is pictured in Beijing. [Photo/IC]

BEIJING - China's central bank injected liquidity into the banking system through reverse repos and medium-term lending facility (MLF) on Friday.

The People's Bank of China conducted 13 billion yuan ($1.83 billion) of seven-day reverse repos at an interest rate of 1.8 percent.

A total of 387 billion yuan was also injected into the market via the MLF, which will mature in one year at an interest rate of 2.5 percent.

The move is aimed at keeping liquidity reasonable and ample in the banking system to fully satisfy the needs of financial institutions, the central bank said in a statement.

A reverse repo is a process in which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future.

The MLF tool was introduced in 2014 to help commercial and policy banks maintain liquidity by allowing them to borrow from the central bank using securities as collateral.

Global Edition
Copyright 1995 - . All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily Information Co (CDIC). Without written authorization from CDIC, such content shall not be republished or used in any form. Note: Browsers with 1024*768 or higher resolution are suggested for this site.
License for publishing multimedia online 0108263

Registration Number: 130349