Economics
PBOC’s Opacity Leaves Markets Guessing Amid Cash Crunch
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China’s second cash crunch this year is revealing some of the risks behind pledges by the nation’s leaders to elevate the role of markets, in a country where policy makers are unaccustomed to detailing their intentions.
The central bank, which unlike counterparts in the U.S., Europe and Japan doesn’t schedule decisions on its main policy tool, saw the seven-day interbank repurchase rate rise for a seventh straight session yesterday even after it released more than $49 billion to selected lenders. The People’s Bank of China is “confused” on whether to target the volume of liquidity or influence the price of credit, Bank of America Corp. says.