- China’s central bank on Monday added liquidity to the banking system through operations of medium-term lending facility (MLF) and reverse repos.
- The People’s Bank of China injected 170 billion yuan (about 24.75 billion U.S. dollars) into the market through one-year MLF with an interest rate of 2.75 percent.
- The MLF tool helps commercial and policy banks maintain liquidity by allowing them to borrow from the central bank using securities as collateral.
- The central bank also conducted seven-day reverse repos worth 20 billion yuan at an interest rate of 2 percent.
- A reverse repo is a process in which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future.
• China’s Central Bank Adds Liquidity Via Operations
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