BEIJING, Oct. 23 (Xinhua) -- China's central bank made a net cash injection via open market operations for the fifth consecutive day Monday in an effort to ease a temporary cash strain.
The People's Bank of China (PBOC) pumped 200 billion yuan (about 30 billion U.S. dollars) into the market through reverse repos, a process by which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future.
The operations included 110 billion yuan of seven-day reverse repos priced to yield 2.45 percent, and 90 billion yuan of 14-day reverse repos with a yield of 2.6 percent.
The injection saw a net 140 billion yuan pumped into the market Monday, offset by 60 billion yuan in maturing reverse repos.
The move is to "keep liquidity basically stable" in response to spiking liquidity demand due to seasonal factors such as tax payments, the PBOC said in a statement on its website.
The central bank has increasingly relied on open market operations for liquidity management, rather than cuts in the benchmark interest rates or reserve requirement ratios.
China has decided to pursue a "prudent and neutral" monetary policy in 2017, applying a full range of policy instruments to maintain basic stability in liquidity and hold interest rates at an appropriate level.