Citic Sees PBOC Staying Out of Market to Curb Debt: China Credit

Two of China’s three biggest securities firms predict the central bank will refrain from using open-market operations to inject funds this week as policy makers seek to rein in debt and contain inflation.

Citic Securities Co., the largest brokerage by assets, said government spending will ease a cash squeeze that drove the benchmark money-market rate up last week by the most since January 2011. Guotai Junan Securities Co., ranked third, said the supply of funds directly to banks alleviates the need for auctions of reverse-repurchase agreements. The monetary authority has suspended offerings of the latter for almost three weeks, the longest pause since July.