China Steps Up Reverse-Repo Operations to Alleviate Cash Crunch
China’s central bank stepped up reverse-repurchase operations today to ease a cash crunch, injecting 150 billion yuan using seven-day contracts and a further 70 billion yuan via 14-day agreements, according to a trader at a primary dealer required to bid at the auctions.
That’s the biggest one-day injection since the current round of reverse repos started in late June. The previous high was 143 billion yuan on July 3.
The seven-day repurchase rate was eight basis points higher at 3.71 percent as of 10:05 a.m. in Shanghai, according to a weighted average. The one-year interest-rate swap fell one basis point to 3.03 percent.
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