(Yicai Global) Feb. 17 - China's central bank the People's Bank of China made a net withdrawal of CNY700 billion (USD100 billion) from the market today.
The PBOC pumped CNY100 billion yuan into the financial system via seven-day reverse repurchases at a 2.4 percent interest rate as CNY1 trillion of reverse repos matured today.
The bank also injected CNY200 billion into the market via a Medium-Term Lending Facility, the result of which was a net withdrawal of CNY700 billion from the interbank market.
The move aims to keep reasonably sufficient liquidity in the banking system, according to a statement on the central bank's website.
A reverse repo is a purchase by the PBOC of securities from commercial banks through bidding, with an agreement to sell them back in future. The MLF is a tool introduced in 2014 to allow commercial and policy banks to borrow from the central bank using as collateral securities they hold.
Editor: Ben Armour