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China Unexpectedly Injects $28 Billion of Cash as Growth Slows

  • PBOC adds liquidity with one-year medium-term lending facility
  • Data to be released Friday may show GDP slowed last quarter
Views Of Chinese Yuan As Yuan Crunch Spurs Banks to Hoard Abroad as China Curbs Outflows
Photographer: SeongJoon Cho/Bloomberg
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China caught traders off-guard with a surprise injection into the financial system via loans to banks, ahead of data on Friday which is expected to show a further slowdown in the domestic economy.

The People’s Bank of China added 200 billion yuan ($28 billion) of one-year cash through the medium-term lending facility on Wednesday. It kept the interest rate steady. The move took traders by surprise as the authorities usually inject liquidity when previously offered loans come due, and the next batch won’t mature until Nov. 5.