China’s central bank resumes open market operations
China's central bank resumed open market operations on Jan. 10 after being suspended for 12 days, a move taken due to a reported lack of liquidity in the system.
The People's Bank of China (PBOC) said on its website that it conducted 60 billion yuan (9.2 billion US dollars) of seven-day reverse repos and another 60 billion yuan of 14-day reverse repos on Wednesday.
Offset by 120 billion yuan (18.4 billion US dollars) of maturing reverse repos, the operations resulted in no net injections into or withdrawals from the money market.
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.
The PBOC said earlier that it would conduct open market operations in a flexible way to meet the liquidity needs of banks.
China will continue a prudent and neutral monetary policy in 2018 as the world's second-largest economy strives to balance growth with risk prevention.
Source(s): Xinhua News Agency