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The PBOC skips liquidity operations for the...>

CHINA
CHINA: The PBOC skips liquidity operations for the 8th consecutive day, noting
high levels of liquidity in the system. Has now drained CNY380bln (CNY90bln
rolling off today) in the longest streak without open market operations in 6
months.
- 1-Year interest rate swap has dropped to 3.59%, one-month Shibor has dropped
to 4.74% -down 19.2bp since Dec 29, while the 3-month Shibor has dropped 10.9bp.
At these levels are still only just off the highest levels of 2017.
- Recent article in the China Securities Journal posits that the PBOC could
resume open market operations later in January after tax payments at the start
of the year hits liquidity levels and companies begin setting aside provisions
for the Lunar New Year.

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