China PBOC skips Open Market Operations today

FXStreet (Mumbai) – For the first time in six months, the Chinese central bank, PBOC, refrained from offering reverse-repurchase agreements in open-market operations.

Bloomberg explained that, “The decision to withhold the short-term lending tool comes after their use was scaled back in Tuesday’s auction window, when 10 billion yuan ($1.5 billion) of seven-day agreements were made available. That compares with a total of 70 billion yuan at the Dec. 22 and Dec. 24 auctions and resulted in a net 60 billion yuan being drained from the banking system this week. Lenders’ demand for funds typically rises in the run-up to year-end liquidity checks by regulators.”

Meanwhile, China Central Bank drains a net 60 bln Yuan for the week via open market operations, versus a net 30 bln injection last week. While in the year 2015, the bank injects a net 10 bln Yuan via open market operations, versus a net 124 bln injection in 2014.

For the first time in six months, the Chinese central bank, PBOC, refrained from offering reverse-repurchase agreements in open-market operations.

(Market News Provided by FXstreet)