The People’s Bank of China pumped 662.5 billion yuan into the financial system through 7-day reverse repurchase agreements, keeping the rate steady at 1.40%. It’s the largest single-day injection in recent weeks, dwarfing the 524.5 billion yuan operation conducted on June 23 and the 420.3 billion yuan deployed on June 16.
Think of reverse repos as the central bank’s short-term lending window. The PBOC buys securities from commercial banks with an agreement to sell them back in seven days, temporarily flooding the system with cash.
A pattern of escalating injections
The trajectory here is worth noting. The PBOC has been steadily increasing the size of its daily operations over the past several weeks. From 420.3 billion yuan on June 16, to 524.5 billion yuan a week later, and now to 662.5 billion yuan. That’s a roughly 58% increase in the size of individual operations over a short stretch.
The rate, meanwhile, hasn’t budged. The 1.40% peg on 7-day reverse repos has remained consistent across all these operations, signaling that the PBOC isn’t looking to change the price of money right now. It’s focused on the quantity.
