People's Bank of China (PBOC) sets yuan reference rate
Yesterday it was set at 6.5528
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And, just repeating, 'cause its unusual:
People's Bank of China open market operations today:
- Injecting 80 bn yuan with 28-day reverse repos
- Injecting 20 bn yuan with 7-day reverse repos
Net 690bn yuan injected for the week via OMOs, vs. 315 injection last week
Cranking it up they are.
I don't know if y'all read my wrap each day (or at least yesterday's). I said on the PBOC OMOs:
There was more interest in the PBOC open market operations; the bank injected 340bn yuan today. Added to the 440bn yuan auctioned on Tuesday this is the largest weekly injection since February of 2013. The point on this is it appears not only to be cash injections ahead of the lunar new year holidays, when demand for liquidity is very high, but also a form of policy easing to take the place of (i.e. instead of) a RRR cut. A RRR cut would be more longer lasting, these reverse repo injections are reversed in 7 or 28 days (d'uh). The People's Bank of China seems to be reasoning that a RRR cut sends too strong an easing signal, especially at this time where capital outflow and yuan devaluation concerns are heightened.
OK, so once again, I reckon this is not just new year liquidity provisioning, there is more to it than that ... its to take the place of RRR cuts. But, we'll see. I still reckon we'll get an RRR cut ... timing though I have no idea.
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Yes ladies and gentlemen ... PBOC open market operations today
Mike had the breaking news: People's Bank of China says OMOs to be conducted every working day until February 19
