zz PBOC Injects $42.14 Billion

maomiji

SHANGHAI—The People's Bank of China injected 265 billion yuan ($42.14 billion) into the money market Tuesday by offering reverse repurchase agreements, as the central bank extends its efforts to ease monetary conditions and bolster a slowing economy.

The liquidity injection, second in size only to its Sept. 25 injection, added to the 2.418 trillion yuan of reverse repos that the central bank had offered since late June.

Data released last week showed manufacturing activity in China contracted for a second straight month in September, adding to doubts about the strength of the world's second-largest economy and suggesting a need for a more aggressive stimulus effort. China's official manufacturing Purchasing Managers' Index remained below 50—indicating contraction—and below the median 50.2 forecast in an earlier poll of 11 economists by Dow Jones Newswires, though the September figure of 49.8 was up from August's 49.2.

Following the central bank's liquidity injection, the benchmark Shanghai Composite Index surged 2% to 2116.79 at the end of the morning session. In afternoon trading it was at 2112.32, up 1.8% for the day.

In a statement Tuesday, the PBOC said it offered 165 billion yuan of seven-day reverse repos, a short-term lending facility, at 3.35% during its regular open-market operation, unchanged from the rate on the seven-day reverse repos it last offered on Sept. 20. It also offered 100 billion yuan of 28-day reverse repos at 3.60%, the same as on Sept. 27.

The central bank offered a record 290 billion yuan of reverse repos on Sept. 25.

Traders say the fund injections could lower China's money-market rates, effectively reducing corporations' financing costs.

Tuesday's fund injection showed a pro-growth policy bias, said Dariusz Kowalczyk, a senior economist at Crédit Agricole CIB, in a note, adding that equity prices will benefit from lower funding costs.

The PBOC carries out regular open-market operations Tuesdays and Thursdays, offering bills and repurchase agreements to control liquidity in the money market.

This week, 10 billion yuan in bills and 170 billion yuan in reverse repos mature.

—Wang Ming

vivocity2010

中国央行维持大规模逆回购
中国央行周二早间在公开市场上继续维持大规模的逆回购操作，最终提前锁定了本周资金净投放，这也显示出央行稳定国庆长假之后资金面的决心。同时，由于本月中下旬将面临巨量资金到期压力，机构将对后续央行的政策动向保持密切关注。

据参与投标的交易员周二早间透露，中国央行今日开展了人民币1650亿元7天期逆回购操作与1000亿元28天期逆回购操作，这也是7天期品种在国庆长假之前暂停一周后再度回归公开市场。

本周到期的逆回购规模达人民币1700亿元，可用来对冲的到期央票和正回购仅100亿元，因此本周公开市场的资金缺口为1600亿元。在今日释放2650亿元流动性之后，已提前锁定本周资金净投放的局面。

此前为应对国庆长假资金备付压力，并考虑到国庆节后例行缴存的资金压力，央行在公开市场上加大了28天期逆回购品种的操作力度，而减少了7天期品种的比重。

而随着国庆长假的结束，7天期品种本周回归，也反映出央行在公开市场逆回购品种选择上更加灵活。

与此同时，交易员透露，央行今日不仅维持7天期逆回购品种发行利率在3.35%不变，同时也维持28天期品种发行利率在3.60%水平不变，表明央行减少资金价格波动的政策意图。。

由于昨日（周一）机构面临本月上旬例行缴存的压力，推动银行间回购资金价格大幅攀升。基准7天回购加权平均利率昨日收报3.83%，较国庆长假前最后一个交易日收盘大涨70个基点；隔夜回购加权平均利率也攀升35个基点至3.73%。

不过，未来在大量逆回购到期以及其他因素的影响下，本月中下旬的资金压力仍不可忽视，机构对于央行的后续政策动向保持高度关注。

交易员称，央行在国庆长假之前的放量逆回购操作中，尤其加大了28天期品种的比重，以应对季末节前的资金压力，因此造成了本月将有逾6000亿元逆回购资金到期，其中在中下旬尤为密集。

同时，10月财政存款增加也会进一步增加本月资金面的压力，由于本周开始第三季度宏观数据将陆续出炉，因此机构也在密切关注数据出炉之后央行政策走向。

交易员进一步解释称，由于11月资金面相对宽松，央行有可能继续使用逆回购工具将本月后续的到期资金压力推后至11月；但考虑到本月后续对冲巨量到期资金的操作压力，也不排除央行在中下旬降准以缓解资金压力的可能性。