China Central Bank Injected Funds to Ease Cash Market Fears

China’s central bank injected funds into the money markets on Tuesday for the first time since February, easing fears of a repeat of the panic in June when cash markets were squeezed.

The People’s Bank of China pumped 17bn yuan (£1.8bn) into markets through seven-day reverse bond repurchase agreements.

The bank made the liquidity injection after allowing a credit crunch to happen in late June as a warning against risky lending practices.

It set the reverse rate to be paid at 4.4%, much higher than the last official guidance of 3.35%.

via The Guardian

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza