China central bank restarts open market operations
The central bank has refrained from open market operations since last Thursday after the central bank reduced the reserve requirement ratio for some commercial banks by 50 basis points, releasing a total of 700 billion yuan into the banking system.
China will maintain a prudent and neutral monetary policy in 2018 as it balances growth and risk prevention.
The operation includes 50 billion yuan (about 4.5 billion U.S. dollars) of seven-day reverse repo priced to yield 2.55 percent, offsetting the 50 billion yuan of maturing contracts on Friday, according to the People's Bank of China.
BEIJING, July 12 (Xinhua) -- China's central bank restarted reverse repo on Thursday to offset the impact of maturing securities after halting such operations for five consecutive working days.
The PBOC said the cut, the third this year following reductions in January and April, was "a targeted, precision regulation" to boost funding for small and micro firms as well as support the debt-to-equity swap program.
A reverse repo is a process by which the central bank bids and buys securities from commercial banks, with an agreement to sell back in the future.