(Yicai Global) June 6 -- China's central bank, the People's Bank of China, conducted open market operations to net inject CNY17 billion (USD2.46 billion) in cash into its monetary system today, after draining a total of CNY300 billion from it over the last two days.

The bank conducted CNY10 billion in seven-day reverse repurchases against CNY30 billion in obligations maturing from an earlier operation.

It also put CNY500 billion worth of one-year, medium-term lending facility loans into the system today, against a total of CNY463 billion maturing MLFs.

The two operations effectively pumped CNY17 billion in liquidity into the system.

Today's MLF operation added loans to small and medium banks, PBOC said in a statement.

MLF loans are one of the several tools the central bank wields to manage monetary policy and lending. They fund banks as authorities intensify efforts to lend to select economic sectors, rather than just adding liquidity to the overall financial system.

Reverse repos agreements are primary tools financial institutions and banks use to provide temporary lending facilities to fund ongoing operations, where a buyer agrees to temporarily buy a basket of securities for a set period and to sell it back later at a slightly higher price via the reverse repo agreement.

The interest rate for the seven-day reverse repo operation was unchanged at 2.55 percent; the interest rate for the MLF operation also stayed the same at 3.30 percent.

Editor: Ben Armour