BEIJING, July 26 (Xinhua) — A total of 160 billion yuan (about 22.9 billion U.S. dollars) of reverse repo contracts are set to mature in the coming week, Securities Times reported.
Over the past week, a total of 617.7 billion yuan were drained from the money market due to maturing contracts including reverse repos and the medium-term lending facility (MLF), according to data by financial information service provider Wind.
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. The MLF tool was introduced in 2014 to allow commercial and policy banks to borrow from the central bank using securities as collateral.
China will pursue a prudent monetary policy in a more flexible and appropriate way, according to this year’s government work report. Enditem