Chinese central bank - the People's Bank of China (PBOC) trimmed its routine open market 7-day reverse repo offerings to merely 10 billion yuan on Tuesday.
PBOC sold 20 billion yuan of 7-day reverse repo last Thursday, but it together with the Ministry of Finance (MOF) pumped 50 billion yuan of liquidity into financial system via a Treasury cash deposit auction early on Tuesday.
Market watchers commented that both of these moves may be sufficient to maintain a calm local financial system shortly after the Chinese central bank dropped rates of standing lending facility (SLF) that its branches provide for qualified local financial institutions to further brighten market liquidity prospects last Thursday.
As a matter of fact, China's financial market has not slid, as it did in the past, into a liquidity crunch recently, even when 10 firms are just to start their initial public offerings (IPO) in near future.
Given the PBOC's intention to keep financial market stability, there will be limited liquidity fluctuations by then, expects a securities broker.
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