The People’s Bank of China announced on September 24 that, in order to maintain ample liquidity in the banking system, it will conduct a 600 billion yuan Medium-term Lending Facility (MLF) operation on September 25 using a fixed amount, interest rate tender, and multiple-price method, with a maturity of one year.
Since 300 billion yuan in MLF is set to mature within the month, this results in a net injection of 300 billion yuan, marking the seventh consecutive month of increased operations.
It is believed that the central bank’s continuous injection of medium-term liquidity sends a policy signal that quantitative monetary policy tools are being steadily strengthened, indicating that monetary policy continues to be supportive. This helps facilitate the smooth issuance of government bonds while better meeting the credit financing needs of businesses and residents.
