China’s central bank conducted 676 billion yuan (USD 94.77 billion) of seven-day reverse repos at an interest rate of 1.8 percent Tuesday.
The central bank said that the move aims to offset the impacts of tax period and keep liquidity reasonable and ample in the banking system, the Chinese news agency (Xinhua) reported.
A reverse repo is a process in which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future.
In 2014, the Chinese central bank began using the medium-term lending mechanism to help commercial and development banks maintain levels of liquidity by allowing them to borrow from the central bank using securities as collateral.
Source: Qatar News Agency