MNI BRIEF: PBOC Bought Net CNY100 Billion CGBs In August
MNI (BEIJING) - The People’s Bank of China announced Friday it had bought a net of CNY100 billion of treasuries in August, indicating it has started using China Government Bonds (CGBs) as a regular monetary policy tool.
According to a statement on the PBOCs’ website, it conducted open market operations involving the buying and selling of government bonds in August, purchasing short-term CGB and selling long-term ones to certain primary dealers in the open market. The Bank did not publish the detailed volume of selling and buying respectively.
MNI reported the Bank would restart treasury trades on the secondary market to support long-term Chinese government bond issuance, (see:MNI: PBOC Eyes Secondary CGB Trading To Support Issuance) and the purchase may indicate the PBOC will operate two-way trade in CGBs to help control liquidity and market volatility (see:MNI: PBOC Eyes CGB Selling To Curb Bull Bond Market)