China's Central Bank Launches New Reverse Repo Operations

The People's Bank of China aims to maintain liquidity with monthly open market operations.

The People's Bank of China (PBOC) has activated its outright reverse repo operations facility to ensure ample liquidity in the banking system.
The new tool will be used to trade with primary dealers on a monthly basis, with a tenor of less than one year.
This initiative is part of the PBOC's strategy to enhance its monetary policy toolbox.
The operations are expected to cover three- and six-month tenors, helping manage liquidity adjustments over the coming year.
The move is also seen as a hedge against the upcoming expiry of the medium-term lending facility before the year's end.