China’s central bank has pumped RMB29 billion ($4.8 billion) of money into the financial system, its first market-wide injection in three weeks, as it looks to put an end to the cash crunch that has rattled the economy.
Chinese banks have been hoarding money, charging each other nearly 9 percent to borrow cash in a near doubling of rates from just one week earlier, a sign of extreme stress in the interbank market.
Over the past week the central bank had provided targeted money to cash-strapped lenders but it had yet to offer any liquidity via its open-market operations, a more transparent and powerful channel for influencing the financial system.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.