People’s Bank of China (PBOC) to drain 48bn yuan via 14-day repo today

• Yuan mid-point set at 6.1073 (6.0641 prior close)
• Draining yuan using forward repos for the first time since June 2013
• Overnight repo opened at 2.7% (vs. 2.5% close on Monday)
• 7-day repo opens at 4.0% (3.74% previous close)

On the drain:

“The PBOC views current market liquidity conditions as over-relaxed,” said Zhou Hao, an analyst with ANZ. “The central bank’s tendency is to maintain generally tight liquidity conditions.”