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China central bank drains biggest weekly liquidity since mid-February

2019-11-01 10:59

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The People's Bank of China (PBOC), the country's central bank, drained 590 billion yuan (about 84.3 billion U.S. dollars) from the banking system this week, the biggest weekly liquidity withdrawal since mid-February.

The PBOC skipped open market operations via reverse repos the whole week, citing reasonably sufficient liquidity.

With a total of 590 billion yuan of reverse repos maturing from Monday to Friday, the PBOC withdrew 590 billion yuan from the banking system.

This represents the biggest weekly withdrawal since mid-February when the central bank drained 680 billion yuan from the banking system from Feb. 11 to 15.

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

China vowed to keep its prudent monetary policy "neither too tight nor too loose" while maintaining market liquidity at a reasonably ample level in 2019.
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