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PBOC Skips OMOs Thursday; Drains Net CNY40 Billion

     BEIJING (MNI) - The People's Bank of China skipped its open market
operations on Thursday, according to the central bank.
     The PBOC said more fiscal expenditure toward the end of the month will
hedge the impact of maturing reverse repos and make the overall liquidity
condition of the banking system relatively high.
     The result was a net drain of CNY40 billion for the day.
     A total of CNY40 billion in reverse repos mature on Thursday. 
     The CFETS-ICAP money-market sentiment index ended at 45 on Wednesday - down
from 61 at Thursday's close, due to the impact of fiscal spending. The lower the
reading the better the liquidity conditions in the interbank market.
     The benchmark seven-day repo average was last at 2.7279%, compared with
2.8823% on Wednesday.
--MNI Beijing Bureau; +86 10 85325998; email: he.wei@marketnews.com
--MNI BEIJING Bureau; +1 202-371-2121; email: john.carter@mni-news.com
--MNI Beijing Bureau; +86 (10) 8532-5998; email: rich.dirks@marketnews.com
[TOPICS: MMQPB$,M$A$$$,M$Q$$$,MN$MM$]

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