SHANGHAI, Jul 15 (Reuters) – The central bank of China partially extended the maturity of its medium-term loans on Thursday, the same day that reductions in reserve requirements for banks take effect.
The People’s Bank of China (PBOC) said in a statement that it is keeping its annual medium-term loans (MLF) rate of 100 billion yuan ($ 15.46 billion) to some financial institutions at 2.95% from previous operations. …
The new infusion did not cover all of the MF’s 400 billion yuan expiring loans maturing on the same day.
China has cut the amount of cash banks must keep in reserves starting July 15, freeing up about RMB 1 trillion in long-term liquidity to support the economic recovery from COVID, which has begun to lose momentum.
In the same statement, the NBK announced that it had poured another 10 billion yuan into the financial system in a seven-day reverse repurchase agreement, offsetting the same amount of such loans due on the same day.
(1 US dollar = 6.4688 RMB)
Vinnie Zhou and Andrew Galbraith reporting; Edited by Jacqueline Wong
Our standards: Thomson Reuters Trust Principles.