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MNI: PBOC Conducts CNY995 Bln MLF Mon; Rates Unchanged

MNI (Singapore)
MNI (Beijing)

The People's Bank of China (PBOC) conducted CNY995 billion via 1-year MLF and CNY89 billion via 7-day reverse repo on Monday, with the rates unchanged at 2.50% and 1.80%, respectively. Today's MLF will lead to a net injection of CNY216 billion after offsetting the maturity of CNY779 billion on Tuesday. The reverse repo operation has led to a net injection of CNY39 billion reverse repos today, according to Wind Information.

The markets expected widely a cut, betting on PBOC‘s further policy easing at the beginning of the year to boost economy, as a result, the yields of long and medium-term CGB have dropped sharply so far this month to four-year low, but MNI predicted the central bank will take a moderate stance for further easing (See: MNI: China To Pursue Moderate Policy Support In 2024)

  • The seven-day weighted average interbank repo rate for depository institutions (DR007) rose to 1.8579% at 09:37 am local time from the close of 1.8415% on Friday.
  • The CFETS-NEX money-market sentiment index, measuring interbank money-market liquidity, closed at 51 on Friday, compared with the close of 50 on Thursday. A higher reading points to tighter liquidity condition, with 50 representing an equilibrium.

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