China’s Central bank completes 700 bln yuan outright reverse repo in May

China’s central bank announced on Friday that it conducted a 700 billion yuan outright reverse repo operation in May to ensure ample liquidity in the bank system.

According to the announcement, the People’s Bank of China (PBOC), the central bank, executed fixed-quantity, interest-rate tendering, and multi-price bidding outright reverse repo operations with maturities of three months (91 days) and six months (182 days), with amounts of 400 billion yuan (about 55.52 billion U.S. dollars) and 300 billion yuan (about 41.64 billion U.S. dollars), respectively.

The open market outright reverse repo is a new liquidity tool introduced by the PBOC in October 2024, aiming to enhance the cross-cyclical adjustment ability of liquidity within one year, and further improve the refinement level of liquidity management.

In another announcement released on the same day, the central bank also noted that no government bond transactions were conducted on the open market in May.