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China’s Central Bank Boosts Injections to the Most in Two Months

  • Corporations’ tax bills could reach 600 billion yuan, ANZ says
  • Liquidity also getting tighter ahead of Lunar New Year holiday
PBOC Headquarters as Central Bank Tests Demand for Two-Month Reverse Repos for First Time
Photographer: Qilai Shen/Bloomberg
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China’s central bank boosted injections via open-market operations to the most in two months to counter seasonal tightening of liquidity.

The People’s Bank of China pumped in a net 270 billion yuan ($42 billion) on Tuesday, as sales of reverse-repurchase agreements more than offset maturities. That’s the most since Nov. 16, data compiled by Bloomberg show. As much as 600 billion yuan is set to leave the financial system as lenders park corporations’ quarterly tax payments at the central bank, said David Qu, a market economist at Australia & New Zealand Banking Group Ltd. in Shanghai.