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PBOC Cuts Liquidity to Prevent Asset Bubbles: Fin News

CHINA PRESS

The PBOC drained CNY150 billion yuan on Thursday, pushing up market rates as regulators hoped to prevent asset inflation and excessive arbitraging through unregulated leveraging behaviors, the Financial News reported citing Zhou Maohua, an analyst from China Everbright Bank. The overall liquidity demand before the mid-February Lunar New Year has dropped as issuance of local debt quotas was delayed, while demand for cash slowed due to pandemic protocols, the newspaper wrote citing Li Yiju, a researcher from the Bank of China. The PBOC may still inject through OMOs to meet rising demand during the Lunar New Year, the newspaper reported citing Li.

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