China’s central bank allocates 2 billion yuan to increase bank liquidity

The People’s Bank of China (PBOC) injected 2 billion yuan (about $295 million) into the Chinese financial system on Tuesday via a 7-day reverse repo deal with an interest rate of 2%.

The PBOC said today’s financial injection is aimed at stabilizing liquidity in the banking system.

A reverse repo is a procedure whereby the People’s Bank of China buys securities from commercial banks in order to resell them in the future.

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