This is the 4th consecutive day where the.....>

CHINA: This is the 4th consecutive day where the PBoC has skipped their open

market operations, today there are CNY240bln of reverse repos maturing.

- A statement on the PBoC website says that contingent reserve allowance and

month end fiscal spending can absorb the impact of reverse repo maturities and

cash demand.

- China money rates have fallen as targeted RRR cuts have boosted liquidity,

last week some banks had their reserve requirements eased which boosted

liquidity. 

- Yesterday the PBoC Vice Gov. said that the Bank would increase flexibility and

effectiveness of its liquidity management.

- The USD/CNY fix rose slightly today due to the rise in the US dollar, the

first time that the central bank set the rate weaker following seven trading

days of stronger fixings. The USD has been underpinned by higher UST yields as

technical selling ahead of the FOMC meeting sees the 10-Year yield rise above

2.70%. The yield rise saw some short covering on USD positions and took the DXY

off a 3-Year low.