(Yicai Global) Oct. 11 -- The Shanghai Interbank Offered Rates continued their slide today despite the People's Bank of China opting to refrain from open market operations for the sixth straight day, thus effectively siphoning cash from the monetary system.

The overnight SHIBOR moved 10.50 basis points lower to 1.9110 percent and the one-week rate was down 3.90 bips at 2.5560 percent. The SHIBOR for three-month loans stayed flat at 2.7180 percent. Only the SHIBOR for one-year loans rose 0.1 bips to 3.0500.

The PBOC has pulled a total of CNY300 billion liquidity from the system this week by omitting open market operations to let maturing reverse repos expire, reiterating that liquidity currently remains at a high level.

Reverse repo agreements are primary tools financial institutions and banks use to provide temporary lending facilities to fund ongoing operations, where a buyer undertakes to temporarily buy a basket of securities for a fixed period and to sell them back at a slightly higher price.

Editor: Ben Armour